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Ajinomoto Co., Inc. Makes Food Company Kükre A.Ş. of Turkey a Wholly Owned Subsidiary – Accelerating Business Expansion in the Turkish Market

| Biz News, Investment & Acquisition, Turkey | 08/21/2017


KUKRER-Turkey

Ajinomoto Co., Inc. Makes Food Company Kükre A.Ş. of Turkey a Wholly Owned Subsidiary – Accelerating Business Expansion in the Turkish Market

Date: Aug 18, 2017
Source: Ajinomoto Co., Inc.

TOKYO, August 18, 2017 – On August 17, 2017 (local time), Ajinomoto Co., Inc. (“Ajinomoto Co.”) acquired an additional 50% of the stock of Kükre A.Ş., a food company in Turkey, for approximately 181 million Turkish Lira (TRY) (approximately JPY 5.7 billion*) and made it a wholly owned subsidiary. With this acquisition, Ajinomoto Co. will accelerate business expansion in Turkey with the intention of further strengthening its operations in the Middle East.

The population of Turkey was about 80 million as of 2016, and the economic growth rate was firm at 5.2% in 2014 and 6.1% in 2015. In 2016, despite the impact of terrorist attacks, a slump in tourism and other factors, growth was 2.9% (source: website of Ministry of Foreign Affairs of Japan), and is expected to continue. In 2011, Ajinomoto Co. established wholly owned subsidiary Ajinomoto Istanbul Food Sales Ltd. in Turkey and began sales of seasonings to restaurants. In 2013, Ajinomoto Co. acquired a 50% stake in premium brand food company Kükre A.Ş., and has been strengthening its existing business in Turkey and expanding business in new areas of food. In 2017, Ajinomoto Co. acquired all shares of Örgen Gıda Sanayi ve Ticaret A.Ş. (“Örgen”), a major food company in Turkey, and has been enhancing its business portfolio in Turkey and rolling out its operations into the Middle East.

As a result of steady growth in sales of vinegars and fruit sauces and enhanced initiatives for growing small-outlet retail chains since Ajinomoto Co.’s 2013 capital participation, net sales of Kükre A.Ş. in 2016 were approximately TRY 70 million (approximately JPY 2.2 billion), nearly doubling from 2014. Making Kükre A.Ş. a wholly owned subsidiary will enable the Ajinomoto Group to act as a comprehensive food manufacturer in Turkey, adding Kükre A.Ş.’s KEMAL KÜKRER brand liquid seasoning business to Örgen’s Bizim Mutfak brand business for bouillon, powdered soups and other products. The Ajinomoto Group intends to further expand its business in Turkey by strengthening cooperation among Ajinomoto Istanbul Food Sales Ltd., Kükre A.Ş. and Örgen.

Ensuring food products business growth with a stronger regional portfolio is a key strategy of Ajinomoto Co.’s FY2017-2019 Medium-Term Management Plan. As such, Ajinomoto Co. is expanding and strengthening its business in Turkey and the Middle East, which it has positioned as “Rising Stars” under the plan. Ajinomoto Co. will continue to contribute to the health and well-being of local consumers through the development of product categories adapted to local eating habits and food culture.

Kükre A.Ş. will become a consolidated subsidiary of Ajinomoto Co. The effect of this change on Ajinomoto Co.’s consolidated results for fiscal 2017 will be immaterial.

* TRY 1 = JPY 31.31 (exchange rate at the time of the share acquisition)

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