(Yicai Global) Dec. 6 -- Shares of Nayuki Holdings rose after the Chinese bubble tea chain said it will invest CNY525 million (USD75 million) in high-end tea brand Lelecha, becoming its rival’s biggest shareholder.

After surging by as much as 17.9 percent this morning, Nayuki [HKG: 2150] closed up 4.9 percent at HKD7.55 (97 US cents).

Nayuki will have an 85 percent stake in Lelecha Cayman once the deal is complete, representing nearly 44 percent of Lelecha operator Shanghai Chatian Catering Management, the Shenzhen-based firm said yesterday.

This year, Nayuki also invested in coffee brand Aokka and sugar-free pastry maker He (Studio), but it is the first time Nayuki invested in a bubble tea brand similar to itself.

Lelecha will keep its own branding, team, and operations, Nayuki said, adding that its strength in store expansion, supply chain, digitalization and automation, and internal management will promote Lelecha’s growth.

With Nayuki’s support, Lelecha will consolidate its product and operational strengths and bring more high-quality products and services to customers, said Li Mingbo, chief executive officer of Chatian Catering.

Lelecha reported revenue of CNY870 million last year, Nayuki said. The high-end tea chain plans to open 72 new stores to reach a total of 158 by the Lunar New Year holiday next month.

China’s tea chains are expected to continue to grow quickly in the next five years, according to China Insights Consultancy. Retail sales will likely reach CNY232.6 billion (USD33.4 billion) in 2025, with a compound annual growth rate of over 26 percent.

Editors: Shi Yi, Martin Kadiev