Japanese trading house Mitsubishi Corp has agreed to acquire a 34 per cent equity stake in Top Ramen instant noodle maker Indo Nissin Foods Limited, the Indian arm of Japan’s instant noodle maker Nissin Foods Holding, according to a statement. Financial terms of the deal however remained undisclosed.
The acquisition is part of the Japanese firms' strategic tie-up wherein Mitsubishi would hold 34 per cent equity interest in Nissin Foods' local instant noodle operations in Singapore, India, Thailand and Vietnam.
Nissin will continue to be controlling stake holder with 66 per cent in Indo Nissin Foods and will drive the business.
The deal also marks expansion of Mitsubishi's entry into consumer-facing business in India. So far, the company has been largely into automobiles besides trading in the country.
“Entering the market for the manufacture and sale of instant noodles, a staple in Asia, will enable MC to establish food processing and manufacturing as one of its core businesses overseas,” Mitsubishi said in the statement.
Mitsubishi is engaged in the general trading business globally and its business interest includes energy, metals, machinery, chemicals, and also has its footprints across processed foods, frozen and chilled foods, confectionery, pet food and liquor in Japan
Founded in 1988, Indo Nissin is into the business of manufacturing and marketing the instant noodles under the Top Ramen, Scoopies and Cup Noodles brand.
The company competes with Nestle’s Maggi which is by far the dominant player and almost synonymous with the category and ITC's Sunfeast Yippee among several others.
India is the fastest growing market for instant noodles and rose from being the ninth largest market in 2009 to the fifth largest, after more than doubling the size to around 5 billion units. It is still a small chunk in the over 100 billion unit industry globally.
(Edited by Joby Puthuparampil Johnson)