A Chipotle acquisition would run roughly $39 billion — and Financial Times reported Thursday that Starbucks has worked with advisors on exactly that kind of proposal. It would be the biggest restaurant deal in history. By a wide margin.

The FT described the work as "early-stage plans" and cautioned the deal "might never get off the ground" given its complexity. Markets split on the news within hours: Chipotle's shares jumped more than 7%, while Starbucks' fell 5%.

"As a matter of policy, we don't comment on rumors and speculation," a Starbucks spokesperson said Thursday. "Our team is laser-focused on executing our 'Back to Starbucks' strategy. We have strong momentum and confidence in our long-term growth potential. We look forward to sharing our Q4 results, including FY27 guidance, later this month."

How big is $39 billion in restaurant terms?

For scale, look at the previous record-holder. Burger King paid $11.4 billion for Tim Hortons in 2014 — about $16 billion in inflation-adjusted dollars. Chipotle's current valuation sits at $39 billion, and any buyer would likely pay a substantial premium on top of that.

Starbucks would almost certainly fund the purchase with debt. Sharon Zackfia, analyst with William Blair, speculated that a sale of Starbucks Japan could help cover the cost. She also warned that pursuing the deal could signal "that management has less confidence in Starbucks' future growth prospects."

What does this change for each chain?

The common thread is Brian Niccol, who left Chipotle two years ago to run Starbucks. Since then the two companies have diverged sharply:

• Starbucks: shares up 21.5% through Wednesday's close; U.S. same-store sales have improved for four straight quarters, including 7.9% last quarter.
• Chipotle: shares down 45% over the same stretch; same-store sales haven't exceeded 2.2% in any of the past six periods, half of which were negative.

That slide has frustrated Chipotle investors and fueled expectations of activist pressure if the turnaround doesn't come quickly. Niccol, who revived the brand after arriving from Taco Bell in 2018, returning as a buyer could read as a positive for the burrito chain.

The case for Starbucks is murkier. "The strategic rationale for [Starbucks] acquiring [Chipotle] isn't apparent to us given limited overlap between the businesses," RBC analyst Logan Reich wrote in a note. The two brands run different supply chains, different formats and different dayparts.

Why the timing raises eyebrows

Starbucks has real momentum for the first time in two years. Under Niccol's "Back to Starbucks" plan, the company overhauled management, restructured the business, closed locations, added workers, began remodeling stores and upgraded technology to reduce order backups. Sales and traffic both improved.

But the work isn't finished. Starbucks just closed another 250 coffee shops — a reminder that its own turnaround still has chapters left, even as the company reportedly sized up the industry's largest-ever acquisition. Whether the proposal advances past the advisor stage, or dissolves as the FT suggests it might, should become clearer when Starbucks reports Q4 results and FY27 guidance later this month.