MANILA, Philippines – Japan’s leading instant food manufacturer, Nissin Foods Holdings, is raising its stake in its joint venture with the Gokongwei-led Universal Robina Corporation (URC) in a bid to integrate its noodle business in the country.
Nissin-Universal Robina Corporation (NURC) is a joint venture that produces and markets Nissin Cup Noodles, Nissin Ramen, and Nissin Yakisoba in the country.
In a disclosure to the stock exchange, URC said it will reduce its stake in NURC to 51% from 65%. Nissin, meanwhile, will hike its share to 49% from 35%.
“By the increase of Nissin’s share, NURC will have a more advance noodle technology as well as greater capacity in order to innovate and create best quality noodle products to address the ever changing needs of the consumers,” URC said.
The parties in the venture both agreed to integrate their noodles business to optimize the resources, achieve efficiency and synergy gains, and establish an effective product portfolio.
NURC also bought its Tarlac noodle plant, equipment, and inventories and now has the license to produce Payless products, URC also reported.
“We have been with Nissin-URC since 1995 and know that Nissin and Payless are great products that have a lot of potential especially in a growing market such as the Philippines,” said Eigo Ogiwara, Nissin Foods chief representative for Asia.
With the new set-up, Nissin, Japan’s leading noodle company, will produce Payless instant noodles using its new technology and equipment.
URC will handle marketing, sales, and distribution.
The resulting synergy will make Payless and Nissin bigger market players and the company more efficient and profitable, URC managing director Nilo Mapa said.
Noodles have become an all-day staple in the country and the trend will grow and become more pervasive as the Philippine population grows, seeking fast food convenience, Mapa pointed out.
“This transaction will help us ride the wave of growth that we expect in the coming years and beyond. We are now second in the market and we want a bigger piece of the pie,” Mapa said.
URC is involved in the manufacture and distribution of branded consumer foods, production of hogs and day-old chicks, manufacture of animal and fish feeds, glucose and veterinary compounds, flour milling, and sugar milling and refining.
In an expansion mode, URC acquired NZ Snack Foods Holdings Limited for NZ $700 million ($548.33 milllion)*.
NZ Snack Foods is the holding company of Griffin Foods – New Zealand’s leading biscuit and snack food company.
In October, URC inked a joint venture agreement with Danone Asia Holdings Private Ltd. of France to manufacture and distribute beverage products in the Philippines starting 2015.
Danone manufactures and supplies fresh dairy products, water, early life nutrition, and medical nutrition in different areas of the world. – Rappler.com
*(NZ$1 = $0.78)