Japanese food groups Ajinomoto and Toyo Suisan Kaisha are ending their joint venture in Nigeria.
Ajinomoto said on Friday (14 October) the companies had decided to terminate their Maruchan Ajinomoto Nigeria venture owing to “the unclear outlook due to the substantial change in the business environment” in the country. Ajinomoto pointed to “the drop in the price of crude oil”.
The two companies announced the venture in January 2014. Ajinomoto held 51% of the venture. It said the end of the venture on its consolidated results would be “immaterial”.
However, Ajinomoto had more positive news for a second venture between the two companies. In January 2014, Ajinomoto and Toyo Suisan also announced a venture in India, Maruchan Ajinomoto India.
Ajinomoto also on Friday announced the venture is to begin the production and sale of instant noodles in India next month.
According to Ajinomoto, the instant noodle market in India is expanding rapidly, on the back of the rising purchasing power of the middle-class consumers and the increasing population. The World Instant Noodles Association estimated annual market growth at around 20% between 2008 and 2014, and Ajinomoto expects the market to continue growing steadily.
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“By combining Ajinomoto’s marketing and sales capabilities with Toyo Suisan’s strengths in development and production, the companies have developed previously unavailable new instant noodle flavours and plan to produce and sell such noodles targeting young consumers from November 2016,” the Japanese company said.
Toyo Suisan owns a 51% share in the Indian venture.