Starbucks pulls out of Israel, ends joint-venture

SEATTLE (AP) — Starbucks Coffee Co. is closing six stores in Israel and is ending its partnership with the Israeli company that ran the coffeehouses. The stores, all in Tel Aviv, will close in April.

Starbucks would not disclose any detailed reasons for dissolving its partnership with the Delek Group of Israel. The two formed the joint-venture Shalom Coffee Co., which was 80.5 percent owned by Delek and 19.5 percent by Starbucks’ subsidiary, Starbucks Coffee International.

“Following months of serious discussions and market reviews with the Delek Group, we came to this amicable and mutual decision,” Mark McKeon, president of Starbucks Coffee International for Europe, Middle East and Africa, said in a statement. “Our commitment in the market continues to be strong and long-term and we will return at an appropriate time.”

The decision to end the partnership was independent of ongoing turmoil in the Middle East and the war with Iraq, said Starbucks spokeswoman Carole Pucik.

“There have been scattered protests and boycotts, but we haven’t felt that they have had a significant impact on our business,” she said.

Officials of the Delek Group, which runs gas stations, convenience stores and other retail ventures in Israel, could not be reached for comment late Monday night in Israel.

The joint venture opened the first Starbucks store in Israel in August 2001, several months into an economic recession that continues to plague that country with double-digit unemployment rates and a deepening deficit.

Starbucks runs stores in North America, Latin America, Europe, Asia and the Middle East, including Bahrain, Lebanon, Qatar and Saudi Arabia.