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CJ invests $62mn in food production complex in HCMC

Released at: 15:47, 27/07/2017

CJ invests $62mn in food production complex in HCMC

Photo: CJ Vietnam

South Korean conglomerate announces investment in food production complex in southern city.

by Hong Nhung

South Korean conglomerate the CJ Corporation has recently announced it will invest nearly $62 million in an integrated production base applying advanced technology in Ho Chi Minh City’s Hiep Phuoc Industrial Park.

A breaking ground ceremony was held recently at the industrial park and once completed in July 2018 the complex will include a processing facility, an R&D center, and a food safety control system.

“CJ sees Vietnam as a strategic market in Southeast Asia,” CEO Mr. Kim Chul Ha said in a statement. “Last year and this year, CJ has focused on investing and expanding in the food business through many M&As in the field of frozen food and seafood processing.”

The complex covers a total area of 66,000 sq m and is set to produce 70,000 tons of food per year. The Vietnam expansion is expected to push the South Korean group’s revenue from the food business to $700 million by 2020.

In the past year and in 2017, CJ has seen remarkable growth in its food business, with the appearance of three new members: Kim & Kim, CJ Cau Tre, and CJ Minh Dat. Through CJ Cau Tre and CJ Minh Dat, the group has also set a target of exporting Vietnamese food and culture to global markets.

With a combination of these three brands, CJ has officially embarked on the construction of a large-scale food complex, applying advanced technology to boost innovation in Vietnam’s food production industry.

In the latest move, CJ last month held a launch ceremony for an agricultural processing plant in south-central Ninh Thuan province primarily focusing on chili processing, with total investment capital of $650,000.

CJ acquired kim chi distributor Ong Kim in January 2016 and bought a 47.33 per cent stake in Cau Tre Foods later in the year. In April 2017, it increased its ownership in the Ho Chi Minh City-based company to 71.6 per cent.

The Ninh Thuan plant covers an area of 640 sq m and has a capacity of 500 tons of chili powder each year. Processed under CJ’s strict conditions, products from the plant will be the main material source for the group’s food industry.

In March 2017, it spent $13.44 million acquiring a controlling stake in Minh Dat Food.

It also secured a 4 per cent holding in Vietnam’s leading meat processor Vissan, when the State company conducted its IPO in March 2016. It competed with homegrown food platform Masan in the race for a 14 per cent stake but lost out.

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