UPDATE 1-Starbucks to close all La Boulange retail locations

Wed Jun 17, 2015 2:30am EDT
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June 16 (Reuters) - Starbucks Corp, the world's biggest coffee chain, said it would close all 23 of its La Boulange retail locations by the end of September as the stores were not sustainable for its long-term growth.

The company will continue to sell La Boulange items such as blueberry scones, iced lemon pound cakes and marshmallow dream bars at its outlets across the United States and Canada, it said on Tuesday. (bit.ly/1SmBvHm)

Starbucks, which bought La Boulange bakery owner Bay Bread Group for $100 million in 2012, said it would also close the two manufacturing plants serving the La Boulange bakery cafes.

The company has 22 La Boulange retail outlets in San Francisco and one in Los Angeles.

Pascal Rigo, the French baker who founded La Boulange, will leave Starbucks, the company added.

Starbucks also said it would also close its Evolution Fresh retail location in San Francisco. It had acquired Evolution Fresh, a premium juice company, for $30 million in 2011.

The company said its goal of growing its U.S. food business by an incremental $2 billion in the next five years remains unchanged.

Food sales grew 16 percent in the second quarter ended March 29, while sales of new breakfast sandwiches rose 35 percent year-on-year, it said.

Starbucks shares, which have risen about 29 percent this year, closed at $52.965 on Nasdaq on Tuesday. (Reporting by Subrat Patnaik in Bengaluru; Editing by Gopakumar Warrier and Anupama Dwivedi)