Ajinomoto Group has signed a share purchase agreement to acquire a 50.1 percent equity stake in US-based French sauces and stocks producer More Than Gourmet Holdings (MTG). The agreement is facilitated in a strategic partnership through Ajinomoto Co.’s consolidated subsidiary Ajinomoto Health & Nutrition North America (AHN). The move is a bid to expand Ajinomoto’s Integrated Food Solutions business in North America.
Ajinomoto is scheduled to acquire the 50.1 percent equity stake in MTG this month, and plans to maintain MTG’s current management structure after the share acquisition. The impact of the acquisition on Ajinomoto’s consolidated business results for fiscal 2019 will be immaterial, the company notes. Ajinomoto has been pushing for food business growth with a stronger regional portfolio as a key strategy of its FY 2017-2019 Medium-Term Management Plan.
Through the expansion of its Integrated Food Solutions business, Ajinomoto offers high added value products adapted to local eating habits and food culture in the prepared take-out foods, food service and restaurant markets.
The size of the B2B market for prepared take-out foods, food service and restaurants in the US is USD$18.3 billion, accounting for about 40 percent of the global market, and steady growth at a rate of 3.2 percent is expected during the period from 2011 to 2025, according to Ajinomoto estimates. In the US food service and restaurant market, the popularity of liquid seasonings (stocks, broths and sauces, etc.) is increasing in comparison to powdered seasonings due to their convenience for in-store preparation and their high-quality image.
In addition, Ajinomoto notes there have been notable moves by food ingredients manufacturers to shift their business models through collaborative efforts with liquid seasonings manufacturers. Specifically, there is a trend for food ingredients manufacturers to add a liquid seasoning manufacturer to their corporate group and incorporate its knowledge of various manufacturing methods, tastes and other matters. Combining this knowledge with the group’s parent company’s own ingredients is a way to provide customized menu proposals as a means to strengthen relationships with specified customers.
Ajinomoto highlights that MTG’s liquid seasonings business, encompassing broths and sauces, is familiar with the trends and preferences of US consumers and has strong connections with processed food manufacturers and food service and restaurant companies. Ajinomoto plans to utilize the brand’s menu customization capabilities in the food service and restaurant market, as well as the direct sales channel to food service and restaurant companies it will acquire through this partnership, and combine them with its own ingredients and taste and texture technologies.
Previously, Ajinomoto accelerated the expansion of its international consumer foods business in Turkey and the Middle East, with last year’s amalgamation of Ajinomoto Istanbul Food Sales Ltd., (“Kükre A.Ş.”) and Örgen Gıda Sanayi ve Ticaret A.Ş. (“Örgen A.Ş.”), both of which are wholly owned subsidiaries in Turkey.
