MANILA, Philippines—Japanese noodle-maker Nissin Foods has scaled up its interest in its Philippine noodle manufacturing business venture with Universal Robina Corp., which also agreed to infuse its “Payless” instant noodle business into this partnership.
In a disclosure to the Philippine Stock Exchange on Tuesday, URC said it would reduce its interest in Nissin-Universal Robina Corp. (NURC), which makes and markets Nissin Cup Noodles, Nissin Ramen and Nissin Yakisoba in the Philippines, to 51 percent from 65 percent to allow the Japanese partner to increase its stake.
SCREENGRAB from www.nissinfoods.com
URC, under its own portfolio, offers instant noodles through the Payless brand. It has agreed to fold this business into NURC. Under this deal, NURC bought URC’s Tarlac noodle plant, equipment, and inventories and now has the license to produce Payless products.
“Both NURC and URC agreed to integrate their noodles business to optimize the resources, achieve efficiency and synergy gains, and establish an effective product portfolio,” the disclosure said.
With this increase in Nissin’s share, the disclosure said, NURC would have “a more advance noodle technology as well as greater capacity in order to innovate and create best quality noodle products to address the ever changing needs of the consumers.”
“We have been with Nissin-URC since 1995 and know that Nissin and Payless are great products that have a lot of potential especially in a growing market such as the Philippines,” said Eigo Ogiwara, Nissin Foods chief representative in Asia.
Under the new set-up, Japan’s leading noodle company will produce Payless instant noodles using its new technology and equipment. URC will handle marketing, sales and distribution.
Nilo Mapa, URC managing director, said the resulting synergy would make Payless and Nissin bigger market players and the company more efficient and profitable.
Noodles have become an all-day staple in the country, he said. The trend is seen continuing as the country’s population grows and seeks fast-food convenience.
“This transaction will help us ride the wave of growth that we expect in the coming years and beyond. We are now second in the market and we want a bigger piece of the pie,” Mapa added.
Intensifying collaborations with big foreign players is part of URC’s strategy to build itself up as a formidable pan-ASEAN (Association of Southeast Asian Nation) conglomerate.