January 24, 2011
Kirin and China Resources Enterprise, Limited agreed to establish a Non-Alcohol Beverage Joint Venture in China
Tokyo, January 24, 2011 -- Kirin Holdings Company, Limited (Tokyo, Japan: President and CEO, Senji Miyake; hereafter "Kirin") and China Resources Enterprise, Limited (Hong Kong, China: Chairman, Qiao Shibo; hereafter "China Resources Enterprise"), a consumer goods company with core activities being retail, beer, food and beverage in China, have entered into an agreement today, by which the both parties establish a joint venture to operate non-alcohol beverage business in China. The investment percentage of Kirin and China Resources Enterprise will be 40% and 60% respectively. The details of the joint venture are to be discussed and determined by both parties.
Kirin will purchase 40% shares in the holding company of the non-alcohol beverage subsidiary of China Resources Enterprise, while transferring Kirin's stake in each of its subsidiaries, Shanghai JinJiang Kirin Beverage & Food Co., Ltd., Kirin Beverage (Shanghai) Co., Ltd., Shanghai Kirin Beverage & Food Co., Ltd., Beijing Flying Kirin Beverage Co., Ltd., to under the holding company. Kirin's investment amount in this transaction will be approximately US$400 million (approximately JPY33.2 billion).
- * US$1=JPY83.05 (as of January 21, 2011)
China Resources Enterprise is a leading company that operates consumer goods businesses in mainland China and Hong Kong. Its parent company is China Resources (Holdings) Co., Ltd., which is one of the leading conglomerates in China covering numerous sectors including retail, food, pharmaceuticals, real estate, power, gas, and finance in Asia.
China Resources Enterprise has established a network of over 3,000 retail stores nationwide in China. Its principal company for non-alcohol beverage business is C'estbon Food & Beverage (Shenzhen) Co., Ltd. with major brand of "C'estbon." Kirin, in China, has expanded its business mainly in Shanghai, Guangzhou and Beijing areas to date, with its major brands of "Kirin Go-go-no Kocha" (black tea) and "Kirin FIRE" (coffee) and accumulated know-how on methods of marketing in China.
At the new joint venture, excellent synergy will be created by the combination of Kirin Group, with the strengths in product development, technology, and research/marketing, and China Resources Enterprise, with its strong business franchise in the nation including its logistics and sales network. By exploiting full potential of the synergy, the joint venture will speed up its foray into new product categories and new markets throughout China, aiming to become a leading player in this rapidly growing market.
Kirin's vision, as stated in its long-term strategic plan KV2015, is to become a leading company in Asia and Oceania in the area of food and health, and it has been pursuing its business strategy focused on growing profitability in these regions and areas. Through the establishment of the joint venture, Kirin Group will further strengthen the foundation of non-alcohol beverage business in China to accelerate the expansion and development.
Outline of China Resources Enterprise
| (1) | Name (English) | China Resources Enterprise, Limited |
| (2) | Head Office | Hong Kong |
| (3) | Representative | Qiao Shibo |
| (4) | Business | Retail, beer, food and beverage |
| (5) | Sales | Approximately HKD71.6 billion (approx. JPY764.3 billion) |
| Income after Tax | Approximately HKD3.8 billion (approx. JPY40.4 billion) | |
|
||
| (6) | Number of Employees | Approximately 152,000 |
Outline of China Resources C'estbon Food & Beverage (Shenzhen)
| (1) | Name (English) | China Resources C'estbon Food & Beverage (Shenzhen) Co., Ltd. |
| (2) | Head Office | Shenzhen, Guangdong |
| (3) | Representative | Liu Hongji |
| (4) | Business | Production and distribution of non-alcohol beverage |
| (5) | Sales | Approximately HKD1,592 million (approx. JPY16.9 billion) |
| Income after Tax | Approximately HKD144 million (approx. JPY1.5 billion) | |
|
||
| (6) | Number of Employees | Approximately 2,810 |
Outline of Shanghai JinJiang Kirin Beverage & Food
| (1) | Name (English) | Shanghai JinJiang Kirin Beverage & Food Co., Ltd. |
| (2) | Head Office | Baoshan District, Shanghai |
| (3) | Representative | Minoru Minyu |
| (4) | Business | Production and distribution of non-alcohol and low-alcohol beverage |
| (5) | Number of Employees | Approximately 650 |
Outline of Kirin Beverage (Shanghai)
| (1) | Name (English) | Kirin Beverage (Shanghai) Co., Ltd. |
| (2) | Head Office | Baoshan District, Shanghai |
| (3) | Representative | Atsushi Kobayashi |
| (4) | Business | Production and distribution of non-alcohol beverage |
| (5) | Number of Employees | Approximately 70 |
Outline of Shanghai Kirin Beverage & Food
| (1) | Name (English) | Shanghai Kirin Beverage & Food Co., Ltd. |
| (2) | Head Office | Jiading District, Shanghai |
| (3) | Representative | Atsushi Kobayashi |
| (4) | Business | Production and distribution of non-alcohol beverage |
| (5) | Number of Employees | Approximately 110 |
Outline of Beijing Flying Kirin Beverage
| (1) | Name (English) | Beijing Flying Kirin Beverage Co., Ltd. |
| (2) | Head Office | Chaoyang District, Beijing |
| (3) | Representative | Atsushi Kobayashi |
| (4) | Business | Distribution of non-alcohol and alcohol beverage |
| (5) | Number of Employees | Approximately 10 |