Singapore-based Delfi and South Korea's Orion have signed a joint venture (JV) agreement to form Delfi-Orion, to develop, market and sell a range of joint-branded confectionery products in Indonesia.
Both firms will have a 50% stake in the JV with an initial investment of $3m.
Delfi will offer its sales, marketing and distribution capabilities to the JV, as well as extensive market knowledge.
Delfi's expertise is not only restricted to the chocolate confectionery category but also extends to a broad range of other FMCG categories. It currently has more than a 50% share in the confectionery market.
A leading snack and confectionery company in South Korea, Orion exports its products to more than 75 countries and has a market capitalisation of around $6bn.
The company will contribute product knowledge and manufacturing expertise, as well as the experience of globally expanding its business, especially in Vietnam and China.
Talking about the JV, Delfi chief executive officer John Chuang said: "It will allow us to extend our portfolio into the soft biscuit and cake category that has been developed and perfected by Orion over the years.
"With this synergistic Delfi-Orion partnership, which combines the respective strengths of both partners, we believe this collaboration will allow the JV to capitalise on the growth opportunities resented."
The launch of the JV requires regulatory approvals.
This agreement is not expected to have any material impact on the earnings of Delfi for the financial year ending 31 December.
