Troubled South Korean food groups struggling to recover from the economic crisis of 1997 are becoming increasingly vulnerable to takeover from their richer Western counterparts. For example, US crop dealer Cargill is reported to be vying with Anglo-Dutch consumer goods giant Unilver over Shindongbang, a Korean cooking oil group. Cargill is currently ahead of the European group, and has been conducting due diligence on Shindongbang.
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Haitai Confectionery is also said to be on the shopping list of Western sweetmakers, including the world’s largest food group, Nestlé of Switzerland, and Nabisco, the biscuit group recently acquired by Kraft Foods of the US.
According to Asia Pulse, another trend identified is an increased eagerness among Western food producers to find distribution in South Korea. US gum manufacturer Wrigley chose Crown Bakery to distribute its products late last year, and compatriot biscuit and confectionery group Hershey has entered a strategic alliance with Maeil Dairy Industry, which is now selling Hershey drinks in Korea.
Following on from this trend, other Western groups are establishing their own local subsidiaries in Korea as the economy stabilises. US dried milk maker Abbott and compatriot ice-cream group Häagen-Dazs are among those actively marketing their products in the country.
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By GlobalData
