Ajinomoto amalgamating subsidiaries to boost business in Turkey and the Middle East

By Lester Wan contact

- Last updated on GMT

Sinan Altun, CEO of Ajinomoto Istanbul, said the company plans to establish its operation in Turkey as its production base for the Middle East region.
Sinan Altun, CEO of Ajinomoto Istanbul, said the company plans to establish its operation in Turkey as its production base for the Middle East region.
Ajinomoto is amalgamating its wholly-owned subsidiaries in Turkey — Ajinomoto Istanbul Food Sales Ltd., Kükre A.Ş. and Örgen A.Ş. — as it seeks to double its annual sales by 2020.

By July 2018, the new company will operate as Ajinomoto Istanbul Food Industry and Trade Limited Company.

Ajinomoto’s business in Turkey first began in 2011, with the establishment of Ajinomoto Istanbul Foods Sales Ltd.

In 2013, Ajinomoto Co. acquired 50% of the equity of Kükre A.Ş. a liquid seasoning company that also produces pickles. It snapped up the remaining 50% just last August.

Due to steady growth in sales of vinegar and fruit sauces, Kükre’s net sales nearly doubled from 2014 to approximately TRY 70m (approximately ¥2.2b).

Also last year, Ajinomoto Co. acquired all shares of Örgen, a major food company in Turkey, which manufactures and sells powdered seasonings such as bouillon and processed foods such as powdered soups and powdered desserts.

Ajinomoto said the amalgamation would lead to consolidated corporate functions and place a greater emphasis on new product development.

The firm also expects to ramp up exports to the Middle East in addition to growing sales in Turkey.

On the back of this plan, the company has targeted sales of more than ¥10 billion by the fiscal year of 2020 — nearly double of sales in the 2017 fiscal year.

Key piece in the puzzle

Sinan Altun, CEO of Ajinomoto Istanbul, said Turkey would play a pivotal role in the company’s expansion plans.

"Ajinomoto Group sees Turkey as the production hub of a region that the company calls a rising star. We basically aim to establish Turkey as a production base for the region,"​ he told local media.

A key strategy of Ajinomoto Co.’s FY2017-2019 Medium-Term Management Plan is ensuring food products business growth with a stronger regional portfolio.

“Ajinomoto Co. will continue to contribute to the health and well-being of local consumers through the development of product categories adapted to local eating habits and food culture,” ​said the company.

According to Ajinomoto, Turkey’s GDP growth rate alone has averaged about 4% annually in the past three years, and steady growth is expected to continue.

In other parts of Asia, we recently reported that Ajinomoto is in the process of acquiring land in Negeri Sembilan​, Malaysia to expand its manufacturing.

However, in Pakistan, the Punjab Food Authority (PFA) banned Ajinomoto seasoning​, calling MSG “hazardous to health”​.

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