Ajinomoto Co. is considering selling Amoy Food Ltd., the century-old company that makes Hong Kong’s most popular brand of soy sauce, according to people with knowledge of the matter.
The Tokyo-based seasoning company is working with an adviser to gauge potential buyers’ interest, according to the people, who asked not to be identified because the information is private.
A sale of Amoy, which began producing soy sauce in China in 1908, could fetch about $70 million to $80 million (¥7.6 billion to ¥8.7 billion), the people said.
The Asian private equity firm Unitas Capital is meanwhile pursuing the sale of another Chinese condiment producer, Jiahao Foods, which makes wasabi, chicken powder and soy sauce. The potential $600 million sale has attracted interest from suitors including Hormel Foods Corp., people familiar with the matter said last month.
Deliberations on a potential sale of Amoy are at an early stage, and Ajinomoto could decide to keep the business, the people said. A representative for Ajinomoto said in response to Bloomberg queries that nothing has been decided.
Ajinomoto bought the Amoy business from Danone for roughly HK$1.8 billion ($235 million) in 2006. About two years later, it recorded an impairment loss of ¥13.4 billion ($122 million) on the goodwill of the unit.
While Amoy is the most popular brand of soy sauce in Hong Kong, where it had a 36 percent market share last year, it doesn’t break into the top five in mainland China, data from Euromonitor International show. The Chinese market for soy sauce is expected to grow 28 percent to 86.2 billion yuan ($13.5 billion) in the five years to 2022, according to the data.
Amoy changed hands several times before Ajinomoto took it over. Prior to Danone buying it in 1991, major shareholders included the American baking giant Pillsbury, Hong Kong property tycoon Ronnie Chan’s Hang Lung Development Co. and the Malaysian conglomerate Sime Darby Bhd.