In return, Kagome, which produces tomato products, hopes to get a chance to export its own vegetable juices into the US. Its overseas operations mainly serve businesses
The deal—which is believed to be worth JPY10bn—makes Tasty Bite a subsidiary of Kagome with an indirect holding of a 51.95% stake after the Japanese firm made a deal to take a 70% stake of Preferred Brands, Tasty Bite’s parent.
Preferred Brands supplies major retail chains in North America, including Costco and Whole Foods, whereas Kagome ended its relationship with the US market in 2008. Preferred Brands’ sales channels might facilitate a return.
Tasty Bite’s meals, which include noodle and rice dishes, are also available outside the US, in countries including Australia and Japan from the company’s Indian production facility. The company also supplies sauce and other products to restaurant chains in India.
The companies hope there will be synergies, with Preferred Brands' customer base centred on health-conscious consumers linking well with Kagame’s own vegetable juice business.
Kagome, in its regulatory submission, suggested it may also be able to provide expertise in materials procurement and quality control through joint product development with Tasty Bite.
Following the deal, Kagome aims overseas markets will account for 30% of global sales in the near future, up from 14.6% in 2013.