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June 10, 2020

Indofood confirms plan to buy noodle supplier Pinehill

Noodle giant Indofood Sukses Makmur has confirmed a plan to acquire one of its manufacturing partners in a deal worth around US$3bn.

By Dean Best

Noodle giant Indofood Sukses Makmur has confirmed a plan to acquire one of its manufacturing partners in a deal worth around US$3bn.

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The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
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Indofood CBP Sukses Makmur (Indofood CBP), one of Indofood’s subsidiaries, said it is preparing to pay $2.998bn for Pinehill Company, which manufactures noodles for the business in seven countries.

Under the terms of the proposed deal, Indofood CBP will pay $1.53bn to Pinehill Corpora for its 51% stake in Pinehill Company and $1.47bn to investment fund Steele Lake for its 49% shareholding.

In a stock-exchange filing, the publicly-listed Indofood CBP described Pinehill Corpora as an “affiliated party”. It said Steele Lake is “beneficially owned” by ASM Telok Ayer Fund, a discretionary investment fund managed and ultimately controlled by Hong Kong-based investor Argyle Street Management.

Indofood CBP plans to hold a shareholders’ meeting on 15 July to vote on the proposed transaction.

In February, Indofood CBP revealed it was mulling a move to buy Pinehill Company. Under a licensing agreement, Pinehill Company manufactures noodles in Saudi Arabia, Nigeria, Turkey, Egypt, Kenya, Morocco and Serbia. The products are sold under Indofood’s Indomie trademark.

Indofood CBP Sukses Makmur is the consumer brand arm of the wider Indofood group, which also has interested in agribusiness and distribution, as well as wheat flour and pasta production through its Bogasari division.

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What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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