© Morinaga Milk Industries
Japanese confectioner Morinaga & Co is set to integrate its business with Morinaga Milk, according to reports.
The combination is expected to be completed by April 2018 and will realise significant benefits in terms of their research and development operations, as well as the benefit of shared sales channels outside Japan.
It’s not the first time that the separate entities have teased a merger, with speculation abounding as far back as December 2008.
The two businesses have shared origins but Morinaga’s dairy operations were spun off into Morinaga Milk almost 70 years ago. Those businesses could now reunite under a single holding company, with Morinaga Milk president Michio Miyahara and his counterpart at Morinaga & Co, Toru Arai, expected to take up the positions of chairman and president respectively, Nikkei Asian Review reported.
Any prospective deal would create a giant with operations in confectionery, bakery, infant formula and dairy drinks – plus combined sales of ¥785 billion ($6.97 billion).
Earlier this month, consumer goods company Reckitt Benckiser agreed a $17.9 billion deal for infant formula manufacturer Mead Johnson, which will significantly boost its performance and reach in Asia.
Trading of shares in the two companies was halted earlier following news of the merger.
Morinaga & Co was up 6.8% and Morinaga Milk was 15.1% higher immediately after reports emerged.
More to follow.
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