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Ajinomoto takes control of stocks and sauces company

Ajinomoto has signed a share purchase agreement to acquire a 50.1% equity stake in More Than Gourmet Holdings of the United States for a strategic partnership through Ajinomoto’s consolidated subsidiary Ajinomoto Health & Nutrition North America.

By augmenting this U.S. liquid seasonings business and its associated sales channel for food service and restaurant customers through the combination of Ajinomoto proprietary ingredients and "deliciousness technologies" with capabilities to make proposals to customers in the United States, Ajinomoto says it will enhance the Ajinomoto Group's Integrated Food Solutions business in North America.

The size of the B-to-B market for prepared take-out foods, food service and restaurants in the United States is $18.3 billion, accounting for about 40% of the global market, and steady growth at a rate of 3.2% is expected during the period from 2011 to 2025 (source: Ajinomoto Co. estimate). In the U.S. food service and restaurant market, the popularity of liquid seasonings (stocks, broths and sauces, etc.) is increasing, according to the company, in comparison to powdered seasonings due to their convenience for in-store preparation and their high-quality image. In addition, Ajinomoto notes there have been notable moves by food ingredients manufacturers to shift their business models through collaborative efforts with liquid seasonings manufacturers. Specifically, the company says, food ingredients manufacturers have been shifting toward adding a liquid seasoning manufacturer to their corporate group, incorporating its knowledge of various manufacturing methods, tastes and other matters, then combining them with the group's parent company's own ingredients to provide customized menu proposals as a means to strengthen relationships with specified customers.

Ajinomoto says it has strengths in savoury powdered seasonings and "deliciousness technologies" cultivated over many years of research, and has established good relationships with over 500 customers including processed food manufacturers and food service and restaurant companies. Meanwhile, MTG's liquid seasonings business, including broths and sauces, is said to be familiar with the trends and preferences of U.S. consumers and to have strong connections with processed food manufacturers and food service and restaurant companies as a result of its original manufacturing technologies for achieving high quality, customized solutions that meet customer needs. Ajinomoto will utilize the menu customization capabilities in the food service and restaurant market, as well as the direct sales channel to food service and restaurant companies it will acquire through this partnership, and combine them with its own ingredients and taste and texture technologies. By doing so, Ajinomoto says it aims to expand its Integrated Food Solutions business in North America and establish a new specialty.

Ajinomoto plans to maintain MTG's current management structure after the share acquisition. The impact of the acquisition on Ajinomoto Co.'s consolidated business results for fiscal 2019 will be immaterial.