CJ CheilJedang begins assault on global amino market with Haide buy

By RJ Whitehead

- Last updated on GMT

Photo: iStock
Photo: iStock

Related tags: Amino acid

In a bold move, CJ CheilJedang, Korea’s biggest food company, has acquired China’s Ningbo Zhenhai Haide Bichem in a US$30.9m deal that will pave the way for Seoul-based CJ to expand in the growing global functional amino acids market. 

Haide, which operates two production sites inside the Ningbo economic development zone in Zhenjiang province, is a leading manufacturer of food and functional amino acids for use as ingredients for foods, drinks, supplements and cosmetics in global markets. 

Its acquisition will allow CJ to increase its portfolio to include more than 40 different types of amino acids and derivatives through integration with its own fermentation technologies. 

The company’s parent, CJ Group, has become increasingly active in mergers and acquisitions both in Korea and abroad, in sharp contrast to its conservative approach in the past.

By making substantial investments in its core technologies, facilities and staffing over the next five years, CJ plans to generate sales in functional amino acids worth US$400m by 2020 to seize 35% of the US$870m global market, taking it to the top three players in the world. 

It also intends to diversify its businesses to include pharmaceutical amino acids such as intravenous fluids and amino acids for infants. 

Haide’s plant will be used to refine over 40 kinds of amino acids and derivatives including fermented cysteine, bio-based methionine, citrulline and ornithine in a bid to penetrate the US$1bn market for functional amino acids. 

The Korean food major initially focused on launching amino acids for animal nutrition, such as lysine, threonine, tryptophan, methionine and valine, said CJ CheilJedang’s, executive senior vice-president, Roh Hang-duk. 

CJ became the world’s first company that has competencies of producing the top five limiting amino acids for animals. Now, based on the acquisition of Haide, the company will put out more efforts to establish foothold in the functional amino acid industry as well​,” said Dr Roh. 

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