Starbucks buys bakery to improve pastry offerings

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NEW YORK (AP) -- Starbucks Corp. is looking to expand its food business, with a $100 million cash deal to buy a small bakery chain.

The Seattle-based coffee shop chain says baked goods and pastries from La Boulange will start replacing its current lineup early next year. Starbucks also says it plans to make the San Francisco-area bakery into a national presence in the years ahead.

Food has become an important part of Starbucks' revenue stream in recent years. About a third of the purchases in its U.S. locations now include a food item.

La Boulange, which also serves salads and sandwiches in a casual sit-down setting, has 19 locations in the Bay Area. The deal also positions Starbucks to enter a fast-growing segment of the restaurant industry currently dominated by Panera Bread Co.