In a move that sees them entering the coffee shop business in mainland China, China Resources Enterprise, has bought an 80% stake in Hong Kong coffee chain Pacific Coffee for HK$326.6 million (US$41.97 million).

The deputy managing director of China Resources Enterprise, Frank Lai, had expressed confidence that market demand will be strong and will grow very quickly, citing the fact that the increase of consumers’ standard of living and the advent of the coffee store business by Starbucks’ entry into China had made his prediction all but absolute.

Backing this forecast, JP Morgan analyst Ebru Kurumlu commented on the company’s acquisition, saying in a report quoted by Bloomberg that “We do not expect (it) to have a major impact on earnings in the short term”. 

China Resources has a network of around 2,900 retail stores in the mainland, with hopes of opening a Pacific Coffee outlet in each of China Resources’ 200 key retail stores.