(Reuters) -Starbucks ( SBUX ) said on Monday it would sell control of its China operations to investment firm Boyu Capital in a deal valued at $4 billion, in one of the most valuable divestments of a China unit by a global consumer company in recent years.

Under the agreement, the companies will operate a joint venture with Boyu holding an interest of up to 60% in Starbucks' ( SBUX ) retail operations in China.

Starbucks ( SBUX ) will retain a 40% interest in the joint venture and will continue to own and license the brand and intellectual property to the new entity, the companies said.

Starbucks ( SBUX ) expects the total value of its China retail business to exceed $13 billion, which includes proceeds from the sale of a controlling interest in the joint venture to Boyu as well as the value of Starbucks ( SBUX ) retained interest in the venture.

Starbucks ( SBUX ) is divesting in China as its market share has declined in recent years due to fierce competition from local coffee chains that offer cheaper products amid an economic slowdown that has changed consumer habits.

Its market share in China - home to more than a fifth of its cafes - fell sharply to 14% last year from 34% in 2019, according to Euromonitor International data.

(Reporting by Kane Wu; Editing by Richard Chang and Sriraj Kalluvila)