HONG KONG & BOSTON, U.S. – Gong cha Group (“Gong cha”), a leading global provider of premium tea, and TA Associates, a leading global growth private equity firm, have announced that TA Associates has completed its previously announced strategic growth investment in Gong cha. Financial terms of the transaction were not disclosed.
Founded in 2006 in Kaohsiung in southern Taiwan, Gong cha is one of the most recognized Taiwanese tea brands in the world. Gong cha, which translates to “tribute tea for the emperor,” provides quality tea, products and services, sourcing ingredients from selected suppliers and offering customers freshly brewed tea.
The Company’s leading product is its famous Taiwanese-style bubble tea, which is sweet milk tea infused with pearl-shaped tapioca. Utilizing primarily a franchise model, Gong cha reaches consumers through a variety of retail store formats, including urban and suburban stores, as well as take-out shops, mall-based stores and kiosks, often in high traffic areas such as train and metro stations.
There are more than 1,100 Gong cha stores in 17 countries, including Taiwan, Korea, Japan, the Philippines, Vietnam, Malaysia, Singapore, Mexico, Australia, Canada, the United Kingdom and the United States.
Partners Group, the global private markets investment manager, has, on behalf of its clients, provided debt and equity to Gong cha to support the transaction through its Private Debt business. In addition, as part of the transaction, Gong cha management and the founders of Gong cha Korea and Japan made substantial investments in the Company alongside TA and Partners Group.
“We are very pleased to invest in Gong cha, a high-growth business that is among the world’s most recognized Taiwanese tea brands,” said Edward Sippel, a Managing Director at TA Associates and Co-head of Asia operations of TA Associates Asia Pacific Ltd. “We are extremely impressed with how successfully the management team has grown Gong cha into the profitable, global business it is today. We will work closely with management in supporting the Company’s franchise partners and look forward to helping grow the Gong cha brand in new and existing markets.”
Gong cha has a track record of successful growth, having grown revenue and EBITDA from 2016 to 2019 at a 43% and 70% CAGR, respectively.
“The global tea market has enjoyed steady growth over the past several years, and tea remains a staple beverage across Asia and increasingly around the world,” said Michael Berk, a Managing Director at TA Associates. “Globally, the tea market is estimated to be larger than that of coffee, with continued expected growth. Given these market dynamics, we believe that Gong cha is well-positioned to further expand its presence and brand throughout the world.”
TA Associates is one of the most experienced global growth private equity firms, having raised $32.5 billion in capital since its founding in 1968. TA is committed to supporting Gong cha’s continued growth as the Company expands its investment in human resources to further the growth and scale of the Company. In connection with the closing, the following appointments were announced:
Peter Rodwell will join as Executive Chairman of Gong cha. Mr. Rodwell brings more than three decades of retail food and beverage and franchising experience to the Company, having led McDonald’s expansion across Asia-Pacific and the Middle East.
Eikoh Harada will join as Chairman, President and CEO of Gong cha Japan, and will be joining the global senior leadership team. Mr. Harada brings decades of managerial experience to Gong cha, having previously served as CEO of McDonald’s Japan, as well as Apple Japan.
Gong cha will continue to be led by current CEO Euiyeol Kim, who has overseen the Company’s strong growth over the last five years and has had significant experience in the global consumer retail sector, previously serving as CEO for CJ Foodville, a leading food and food services group. “I am excited to continue on this journey of growth with Gong cha, and look forward to leveraging our proven track record to continue driving expansion globally,” said Mr. Kim.
About Gong cha Group
Founded in 2006, Gong cha is one of the most recognized Taiwanese tea brands in the world. Gong cha, which translates to “tribute tea for the emperor,” provides quality tea, products and services, sourcing ingredients from selected suppliers and offering customers freshly brewed tea. Gong cha’s leading product is its famous Taiwanese-style bubble tea, which is sweet milk tea infused with pearl-shaped tapioca.
The Company also offers a variety of seasonal and specialty tea-based drinks. There are more than 1,100 Gong cha stores in 17 countries, including Taiwan, Korea, Japan, the Philippines, Vietnam, Malaysia, Singapore, Mexico, Australia, Canada, the United Kingdom and the United States. For more information, please visit www.gong-cha.com/en.
