Ajinomoto Co. and Toyo Suisan Kaisha Ltd. have agreed to set up joint instant noodle ventures in India and Nigeria to meet growing demand and challenge their foreign rivals, the two companies said Wednesday.
Ajinomoto, the nation’s leading food additive and seasoning maker, and Toyo Suisan, maker of the Maruchan noodle brand, plan to start marketing instant noodles under a new brand in India in fiscal 2016 and in Nigeria in fiscal 2015, they said.
Toyo Suisan President Kazuo Obata said the Indian and Nigerian markets are extremely attractive because they ranked fifth and 12th, respectively, in terms of servings in fiscal 2012, on the back of rapid economic and population growth.
The companies decided to set up the ventures because they “need to quickly seize the chance” via collaboration to catch up with foreign food makers, which have dominant shares in the markets, he added.
Toyo Suisan will develop and produce the noodles, which will be sold using Ajinomoto’s marketing channels, the two said.
“Toyo Suisan has proved its production capabilities in the competitive U.S. and Mexican markets. The company’s production and development technologies are very appealing to us,” Ajinomoto President Masatoshi Ito said.
The two companies aim to sell 500 million servings a year in each country within 10 years of entering the markets.
Toyo Suisan will hold a 51 percent stake in the joint venture, which is to be established in Chennai, southeast India, and Ajinomoto the remainder.
As for the joint venture in the Nigerian capital of Abuja, Ajinomoto will take a 51 percent stake and Toyo Suisan the remainder.
The food makers will invest about ¥1 billion in each country to set up factories and other facilities for the noodles, which are inexpensive and can be stored at room temperature.
Ajinomoto and Toyo Suisan also announced a partnership in their North American operations, with Toyo Suisan planning to acquire a 20 percent stake in Ajinomoto’s frozen noodle manufacturing business in Oregon.
Ajinomoto’s Ito said “yakisoba” (fried buckwheat noodles) among other Japanese noodles are popular in the U.S. and the companies hope to start new product lineups by taking advantage of the partnership.