Uni-President to make bid for 100% ownership of South Korea food unit

Taipei, Jan. 30 (CNA) Taiwan-based food conglomerate Uni-President Enterprises Corp. intends to pursue 100 percent ownership of South Korean subsidiary Woongjin Foods Co. through tender offers, the company said Monday.

In a statement, Uni-President said its board approved a plan to acquire the remaining 20.68 percent stake in Woongjin Uni-President does not own to fully bring the South Korean food supplier under its corporate umbrella.

Seeing the acquisition as a way to strengthen its sales and profitability, the conglomerate said it intends to spend 15.11 billion South Korean won (US$11.35 million) to acquire 6.57 million Woongjin shares, or a 10 percent stake in the company, from Jan. 29 to Feb. 23.

The average share price of 2,300 won per share would represent a 91 percent premium over the 1,200 won the stock closed at Tuesday.

Once the acquisition of the initial 10 percent stake is completed, Uni-President said, it will kick off the second phase of the plan to take 100 percent control of Woongjin, best known for its beverages, in particular teas and juices.

In 2019, Uni-President acquired a 74.8 percent stake in Woongjin for US$229 million from private equity fund Hahn & Co. and had since increased its holdings to 79.32 percent of the company's shares.

The acquisition of Woongjin's outstanding shares reflects the ambition of Uni-President Group Chairman Alex Lo (羅智先), who wants to further extend the company's reach into Northeast Asia and establish a cross-Asia distribution platform, analysts said.

Uni-President began diversifying its business regionally in 2019 when it entered China's market by setting up an instant noodle production site in Beijing.

It then teamed up with Japanese partners to roll out food products in Southeast Asian markets, and has also set up production and operating hubs in the Philippines, Thailand, Vietnam and Malaysia.

In addition to food supplies, Uni-President has broadened its product portfolio by stepping into logistics, biotechnology, health and beauty retail, and department store operations.

Last year, the conglomerate acquired the 60 percent share of Carrefour Taiwan held by its French parent company to gain full ownership of the retail brand's operations in Taiwan.

In the Philippines, the Taiwanese food giant operates the 7-Eleven convenience store chain as it does in Taiwan.

When Hahn put its stake in Woongjin up for sale in 2018, Uni-President felt it was a good opportunity to make inroads into South Korea as well as the Northeast Asian market.

According to international news reports, the sale by Hahn attracted interest from three bidders: Uni-President, Taiwan-based food processor Want Want Holdings Ltd., and Korea's Hyundai Group, and the two Taiwanese companies were in a horse race to the end.

Lo has said his goal is for the company's annual sales to hit NT$700 billion (US$22.36 billion).

In 2023, Uni-President had consolidated sales of NT$580.99 billion, up 10.74 percent from a year earlier.