DUNKIN' Donuts, the world's largest coffee and baked goods chain, said it will open its first store on the Chinese mainland in Shanghai in May.

In an agreement signed last Saturday, the company granted the franchise rights for Shanghai and Jiangsu and Zhejiang provinces to its partner, Taiwan-based Mercuries & Associates, to open a total of 100 stores over the next decade.

More than 100 million yuan (US$13.87 million) will be invested into the new stores and factories in Shanghai. Two million yuan will also be spent on a marketing and communication campaign after the launch of the Dunkin' Donuts brand, according to Mercuries & Associates.

The new Shanghai store will serve a complete menu of Dunkin' Donuts' products, including hot and iced beverages, as well as a wide variety of donuts and baked goods.

All the stores will also offer items adjusted to local customers' taste, such as green tea and soybean flavored donuts, along with mochi rings, made with traditional Chinese rice flour, like cake donuts.

The Taiwanese firm is building its first factory in Shanghai, according to Andrew Chang, president of Mercuries Food Division.

Founded in 1950, Massachusetts-based Dunkin' Donuts, a subsidiary of Dunkin' Brands Inc, owned by a trio of private equity firms, operates 7,200 stores in 31 countries and regions.

Mercuries, founded in 1964, operates retail, trade and financial services, and its food division runs more than 300 stores in Taiwan, including 10 Dunkin' Donuts stores after opening its first in Taipei last year.