Apr. 30, 2013
Agreement reached to establish a joint venture company for sugar production and sales in China
Sumitomo Corporation (Head Office: Chuo-ku, Tokyo; President and CEO: Kuniharu Nakamura), Taikoo Sugar Limited (Head Office: Hong Kong; President: Max W.L. Lau; hereinafter, "Taikoo"), and TS Corporation (Head Office: Seoul, South Korea; President: Myung Sik Lee; hereinafter, "TS") have agreed to establish a joint venture company for production and sales of sugar (hereinafter "JV company") in Guangdong Province, China. Taikoo, TS and Sumitomo Corporation will own 34%, 33% and 33% interests, respectively, in the JV company.
In 2012, total annual consumption of sugar in mainland China reached 14 million tons. As the beverage market expands in tandem with the rapid economic growth and westernization of dietary patterns in China, sugar consumption is expected to grow 5% annually. Moreover, due to rising concerns over food safety, demand for high-quality sugar is increasing mainly from major food processing manufacturers and volume retailers. Taikoo, TS and Sumitomo Corporation have already worked together in sugar trading in and around China and have built up a strong relationship of trust. Based on this trust, the three companies have decided to jointly expand their sugar business into Chinese high-quality refined sugar market, which is expected to achieve significant growth in the years to come.
The JV company will combine Taikoo's brand power and marketing capabilities, TS's advanced manufacturing technologies, and Sumitomo Corporation's experience in sugar trading in Southeast Asia and expertise on overseas business management, with the aim of establishing a system for production and sales of high-quality sugar in mainland China. The three companies have a plan to establish the JV company and construct a sugar refining plant in Guangdong Province, China, aiming to start operation by the end of 2014. Through this business, Sumitomo Corporation will work to contribute to the sophistication of dietary patterns in mainland China.
<About Taikoo Sugar Limited>
A wholly-owned subsidiary of Swire Pacific Limited, Taikoo Sugar markets premium sugar products, private label single-service sachets of sugar, salt, pepper and tea to the retail and catering trades in Hong Kong and Mainland China where it operates two packaging plants. It also has a well-established export business, and currently markets branded sugar products in Southeast Asia, the Middle East and North America. The company was founded in 1881 by Swire.
<About TS Corporation>
Since its establishment in 1956, TS Corporation has been growing as one of the leading food companies in the field of sugar, food, agro business, and animal feed. TS Corporation's know-how has led to TS Corp becoming one of the leading sugar refineries and distributors in Korea famed for strict quality control systems and stable production of refined white sugar. TS Corporation is currently supplying global standard high quality refined white sugar to Japan, China, and various Southeast Asian countries.
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