Supermarket chain operator Seiyu Ltd. and Sumitomo Corp., a general trading house, said Tuesday they have agreed to form a strategic tieup that will make the trading firm a leading Seiyu shareholder.
The deal aims to strengthen the food supermarket businesses of the two firms by combining their corporate resources, especially in the Tokyo metropolitan area.
The two firms will schedule sessions to further discuss the specifics of their tieup.
Seiyu will raise 15.62 billion yen through a third-party allotment of 72 million new shares to 17 parties later this month. Sumitomo will accept 40 million shares, or an 11.83 percent stake, becoming the biggest shareholder of the supermarket chain operator.
“We believe that this tieup will be mutually beneficial. In order to further deepen the ties, we agreed that (Sumitomo Corp.) will bear a part of the third-party allotment,” said Noriyuki Watanabe, president of Seiyu.
Although Seibu Department Stores, Ltd. is the current leading shareholder of Seiyu with a 11.2 percent stake, its holding will diminish to an 8.83 percent stake, making the department store the second-largest shareholder.
However, Watanabe said that the deal does not mean that the supermarket chain wishes to distance itself from the Saison corporate group, of which both Seiyu and Seibu Department Stores are core members, since the group’s combined holdings will still equal a total 29.7 percent stake in the supermarket chain operator after the deal is completed.
Meanwhile, Fumio Wada, executive vice president of Sumitomo Corp., stressed that the tieup with Seiyu will help strengthen his firm’s food retail business.