Ajinomoto Co., Inc. (Ajinomoto Co.) and Toyo Suisan Kaisha, Ltd. (Toyo Suisan), both headquartered in Tokyo, Japan, have exchanged a memorandum of understanding on technological participation by Toyo Suisan in the frozen noodle business of Ajinomoto Co. in North America. Under the agreement, the companies will establish a frozen noodle production company through a joint venture with investments of 80% from Ajinomoto Co. and 20% from Toyo Suisan. The initial investment will be approximately ¥2.5 billion.
Sales will be handled by Ajinomoto North America, Inc. (AJINA), a wholly owned subsidiary of Ajinomoto Co. based in Portland, Oregon, which operates the consumer food business in the United States and Canada. These measures will strengthen the technological side of the frozen noodle business of Ajinomoto Co., which is a growth driver of the company’s steadily expanding frozen food business in North America.
The goal is to hit a sales volume target of 8,000 tons after 10 years in the market, with sales beginning during fiscal year 2015.
Vegetable Chow Mein and Yakisoba Noodles are among Japanese cuisine ready meals dishes marketed in the frozen food aisles of supermarkets by Ajinomoto in North America.Since the establishment of Ajinomoto Frozen Foods USA, Inc. in 2000, the unit’s business has steadily expanded, with net sales estimated to have reached ¥10 billion in fiscal 2013. Among its products, frozen noodles (chow mein) have contributed to business expansion since being launched in 2007. The frozen noodle market in the United States has grown to ¥15 billion in fiscal 2012, representing an 18% increase from the previous fiscal year, according to a survey conducted by Ajinomoto. With a forecast of further market expansion backed by the increasing number of ramen shops in the United States, Ajinomoto has been considering strengthening its competitiveness on the technological side.
In addition, in April of 2013 Ajinomoto Co. established a structure to further strengthen and expand its consumer food business in North America by integrating the operations of the shelf stable business, which centers on seasonings, and the frozen food business.
Toyo Suisan has manufactured and sold frozen noodles since 1984, and in the process has significantly improved its technological capability for frozen noodle manufacturing. Now, with this agreement, Ajinomoto aims to leverage the strength of Toyo Suisan in high-level noodle production technology to lead the frozen noodle market. Its plan is to introduce ramen and other new products in addition to chow mein, thus accelerating expansion of its frozen food business in North America.
Ajinomoto Co. is a global manufacturer of high-quality seasonings, processed foods, beverages, amino acids, pharmaceuticals and specialty chemicals. Founded in 1909 and now operating in 26 countries and regions, it rang up net sales of ¥1,172.4 billion (US $14.1 billion) in fiscal 2012.
Toyo Suisan Kaisha, Ltd., established in 1953, had net sales of ¥344.5 billion during the year that ended on March 31, 2013. In addition to producing noodles and other processed foods, it is active in the seafood and cold storage businesses.
