9 June 2008 – Nissin Food Products Co., a major instant noodle maker, will buy a 100% stake in Osaka-based frozen food manufacturer Nicky Foods Co. for close to 1.8 billion yen ($17 million), local media report.
With this acquisition, which should take effect in July, Nissin Food is looking to strengthen its frozen food operations, which were negatively affected by a poisoned dumpling scandal earlier this year. The scandal forced Nissin to drop its plans to integrate its frozen food section with Japan Tobacco Inc., as reported on FLEXNEWS.
The deal is expected to boost annual sales of Nissin’s frozen food operations to about $377 million, lifting Nissin from 13th to seventh in the frozen food segment. Nissin hopes to boost sales further by reorganizing the two companies’ production systems.
Nicky Foods’ strong point is the manufacturing of frozen Chinese food. The company, which reported sales of $136 million in 2007, is also the main shareholder in Hachi-Ban Co., a chain of noodle restaurants.
Nissin Food will continue to consider mergers and acquisitions in a bid to diversify its operations, add the reports.