Ajinomoto: Cancels Joint Venture Agreement in Nigeria

Tokyo / JP. (aci) Japan’s Ajinomoto Company Incorporated is scheduled to begin production and sale of instant noodles in November 2016 at Maruchan Ajinomoto India Private Limited, a joint venture company it established with Toyo Suisan Kaisha Limited in December 2014. On the other hand, Ajinomoto Company cancelled the joint venture agreement for instant noodles in Nigeria it entered into in March 2014.

The instant noodle market in India is expanding rapidly, backed by the rising purchasing power of the middle class and increasing population, and is expected to continue growing steadily (market size in 2014: 5.3 billion servings; average annual growth rate of 20 percent from 2008 to 2014; source: World Instant Noodles Association). Ajinomoto Company and Toyo Suisan have been working for rapid market entry with the establishment of Maruchan Ajinomoto India Private Limited as a joint venture. By combining Ajinomoto Company’s marketing and sales capabilities with Toyo Suisan’s strengths in development and production, the companies have developed previously unavailable new instant noodle flavours and plan to produce and sell such noodles targeting young consumers from November 2016.

With regard to Maruchan Ajinomoto Nigeria Limited, an instant noodle joint venture between Ajinomoto Company and Toyo Suisan in Nigeria, based on the unclear outlook due to the substantial change in the business environment caused by the drop in the price of crude oil, the two companies have decided to cancel their joint venture agreement and to conduct dissolution and liquidation procedures. The effect of this matter on Ajinomoto Company’s consolidated results is immaterial.

Under its Financial Year 2014 to 2016 Medium-Term Management Plan, the Ajinomoto Group has positioned instant noodles as one of its core businesses in local areas and is actively promoting a business roll-out into markets in emerging countries and North America. By making the most of both companies’ strengths to offer «deliciousness that leads to smiles» together with Toyo Suisan in India through the joint venture and by producing high-quality frozen noodles with specialty at the two companies’ joint venture in North America, the Ajinomoto Group will contribute to well-being in each country.