Gong Cha sold to Bain Capital for $635m, with expansion into Americas, Europe planned

Milk tea franchise Gong Cha is set to be acquired by global private equity fund manager Bain Capital. The brand plans to expand its store count in key markets South Korea and Japan while pushing further into the Americas and Europe.

Bain Capital has signed an agreement to acquire Gong Cha Global shares held by US-based private equity firm TA Associates and existing shareholders, according to industry sources. The deal is expected to close in the fourth quarter.

While specific financial terms were not disclosed, Japan's Nikkei reported the transaction is valued at approximately $635 million. Bain Capital's Japan team led the deal, with Nomura Securities advising on the acquisition side and JPMorgan and Northpoint advising on the sale, according to sources familiar with the matter.

Domestic private equity firm UCK Partners acquired Gong Cha Korea in 2014 and bought an additional stake in Taiwan-based Royaltea Taiwan in 2017, restructuring the company so that the Korean entity serves as the global headquarters. TA Associates then acquired Gong Cha from UCK Partners in 2019 for approximately 350 billion won ($246 million) and has remained the largest shareholder since. Once the current deal closes, ownership of Gong Cha will transfer from TA Associates to Bain Capital.

Founded in Taiwan, Gong Cha now operates about 2,200 stores worldwide — roughly 900 in South Korea and about 160 in Japan — and has also established a presence in the United States and Europe. Gong Cha Global, the brand's global headquarters, posted sales of $217 million last year, up 14 percent from the previous year, according to industry sources.

Bain Capital plans to work with Gong Cha's management to continue expanding stores in South Korea and Japan while accelerating the brand's push into the Americas and Europe. The firm has prior investment experience in consumer and food-service businesses, including Domino's Pizza Japan and Japanese restaurant chain Skylark.

"Gong Cha is a global brand with strong franchisee profitability and a loyal customer base," said Naofumi Nishi, a partner at Bain Capital. "We look forward to supporting the next phase of growth across Asia-Pacific and the Americas."