Japanese food wholesaler Kato Sangyo to acquire similar business in Malaysia

16, Dec. 2019

KUALA LUMPUR, NNA - Japanese food wholesaler Kato Sangyo Co. will acquire a similar business Merison (M) Sdn. Bhd. of Malaysia for an undisclosed sum of money, making the Japanese company one of the biggest in the industry sector of that country.

Kato Sangyo will take over a 90-percent stake of Merison, while the 10 percent will remain in Merison, Shigeharu Ota, general manager of the company’s presidential affairs office, said Monday. He added that he expects the deal to close in April or May.

The acquisition of the Melaka Province-based food wholesaler with a strong foothold in the Southern part of the Malay Peninsula will allow Kato Sangyo to expand its operation to the whole area of the peninsula.

In 2018, Kato Sangyo took over Lein Hing Holdings Sdn. Bhd., a Malaysian food wholesaler that covers northern regions of the peninsula.

In response to the shrinking Japanese market, Kato Sangyo is increasingly exploring opportunities in China and Southeast Asian countries such as Malaysia, Ota said.

The Tokyo-listed firm has operations in China, Malaysia, Singapore and Vietnam outside Japan. Its operating profit for the fiscal year through September 2019 increased 5.9 percent from a year earlier to about 10.8 billion yen on revenue of 1.06 trillion yen, up 5.4 percent. Overseas sales represented 3.9 percent of the total revenue.

Kato Sangyo has grown out of a string of acquisitions. It acquired Toan Gia Hiep Phuoc Trading and Food Processing Joint Stock Co., a Vietnamese food wholesaler, in 2016, following its takeover of Naspac Marketing Pte. Ltd., a similar business based in Singapore, in 2015.