Korean seafood giant Sajo is acquiring Foodist for $181 million

Sajo Group, a South Korean seafood and seafood conglomerate, acquired Foodist Co., a domestic supplier of food ingredients and catering services, for 252 billion won ($181 million) to strengthen its food supply chain.

The conglomerate said Monday that its subsidiaries Sajo Oyang Co. and Sajo CPK Co. jointly purchased 99.86% of Foodist from the Seoul-based private equity firm VIG Partners.

The acquisition follows Sajo Group’s acquisition of Ingredion Korea from US food company Ingredion Inc in February. for USD 294 million and changing its name to Sajo CPK.

Foodist is the sixth largest food distribution and catering services operator in Korea.

Hanwha Hotels & Resorts, a subsidiary of Hanwha Group, operated Foodist as its own entity for years until it sold it to VIG Partners in 2020 for about 100 billion won.

Approximately 75% of Foodist’s sales come from its food materials and ingredient distribution business, with the remaining 25% from its catering business.

The company reported 7.5 billion won in operating profit on sales of 1.03 trillion won in 2023.

TAKE OVER TO HELP SAJO UP THE LADDER

With the acquisition of Foodist, Sajo Group is expected to overtake its direct rival Daesang Corp. and will become Korea’s third-largest food conglomerate, after CJ CheilJedang Corp. and Dongwon F&B Co.

Last year, Daesang Group recorded sales of 5.26 trillion won on a consolidated basis, followed by Sajo Group, which posted group-wide sales of 4.13 trillion won. Sajo Group’s sales are expected to reach about 6 trillion won this year.

Sajo Group, a mid-sized business group known for its deep-sea fishing and a wide range of processed seafood products, including canned tuna, is aggressively pursuing inorganic growth through mergers and acquisitions of competing companies.

In 2004, it acquired Shindongbang, a soybean company that was renamed Sajo Haepyo. The group bought Daerim Fisheries in 2006 and changed its name to Sajo Daerim Corp.

In the following years, Sajo also acquired Oyang Corp., now called Sajo Oyang, and Donga One, which became Sajo Donga One Co., a flour and food products company.

VICE PRESIDENT JU JI-HONG IS LEADING THE DEAL

Industry observers said Sajo’s acquisition of Foodist was agreed before VIG Partners officially began bidding.

“We understand that Sajo Group has shown strong interest in Foodist and has strongly expressed its determination to buy it,” an investment banking source said.

Sources said the deal was led by vice president Sajo Ju Ji-hong, the eldest son of group chairman Ju Jin-woo.

“With the acquisition, we aim to achieve group-wide sales of 6 trillion won this year and 10 trillion won in the next five years,” the vice president said.

write to Hyeong-Ju Oh at [email protected]

In-Soo Nam edited this article.