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Kirin Holdings has announced plans to acquire additional shares in Japanese cosmetics and food supplement company Fancl, through a tender offer that will make Fancl a wholly-owned subsidiary.
Kirin acquired approximately 33% of Fancl’s shares in 2019. The two companies entered into a capital and business alliance agreement, and both currently utilise each other’s proprietary ingredients in beverages and supplements.
Now, for a total purchase price of around JPY 220 billion (approx. $1.39 billion), Kirin has put forward a bid to acquire full ownership of Fancl. With Fancl as a wholly-owned subsidiary, Kirin aims to accelerate the creation of a competitive business model by complementing each company’s strengths through mutual utilisation of management resources.
These strengths include Kirin’s long-standing immunology research, ability to develop and manufacture high-value-added ingredients through fermentation and biotechnology and its health food business base in Asia-Pacific, which it acquired through its purchase of Blackmores last year.
Fancl’s strengths include its ability to connect with consumers through its D2C channels, which account for 70% of its sales, and its technology for commercialising products by utilising customer feedback in R&D.
By commercialising ingredients created through fermentation, leveraging customer understanding gained by both companies’ strong consumer relationships, and delivering them through multiple channels in the Asia-Pacific region, Kirin hopes to further enhance its position in the global health food market.
The takeover bid, if successful, is expected to strengthen the companies’ mutual utilisation of operating bases and purchasing data in Japan and overseas, deepen joint research, and enhance horizontal deployment of environmental technologies.
As a core operating company of Kirin’s health science business, Fancl would work closely with Kirin to encourage its growth and further enhance corporate value. The acquisition is part of Kirin’s long-term goal of JPY 500 billion (approx. $3.17 billion) in health science revenue.
Top image: © Fancl
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