Morinaga Le May JV sets target of $71.7 million revenue in Vietnam

May 25, 2023 | 18:13
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Morinaga Milk Industry, a Tokyo-based dairy company, forged a strategic partnership with Le May, a subsidiary of Vietnam’s Lotus Group, to establish the Morinaga Le May Joint Venture in Vietnam on May 23.
Morinaga Le May JV sets target of $71.7 million revenue in Vietnam

With Morinaga Milk Industry holding a controlling 51 per cent stake, this joint venture (JV) aims to achieve a revenue milestone of JPY 10 billion, or nearly $71.7 million in Vietnam while expanding its footprint in the international market.

Yohichi Ohnuki, CEO of Morinaga Milk Industry, disclosed that the company had invested a sum of $4.5 million to secure the majority share of 51 per cent in the JV.

Le Van May, chairwoman of Lotus Group and CEO of Morinaga Le May Vietnam, said that the core operations would revolve around the importation and distribution of premium-quality formula milk products catering to the needs of mothers and infants.

This sector has witnessed an exclusive and fruitful collaboration between Le May and Morinaga Milk Industry in the Vietnamese market for over a decade, nurturing a solid foundation of expertise and mutual understanding.

Focusing on the distribution of premium products manufactured in Japan, the JV will play a pivotal role in bolstering Morinaga's annual revenue target of $72 million within Vietnam.

Ohnuki emphasised the firm’s commitment to conducting in-depth market research, closely monitoring the ever-evolving demands of Vietnamese consumers.

“By attaining real-time insights into customer preferences and aspirations, the JV aims to tailor its product development initiatives and business strategies to ensure utmost relevance and appeal in the dynamic Vietnamese market,” he said.

Accordingly, Vietnam's burgeoning market for infant and toddler milk products is experiencing robust growth, fuelled by the nation's impressive economic trajectory and its rank as the world's 14th most populous country, with 1.4 million annual births.

With over 10 million Morinaga products delighting Vietnamese consumers to date, the company's leadership attributes this remarkable feat to its unwavering commitment to uncompromising quality.

In 2021, Morinaga Milk Industry made a significant acquisition by purchasing Elovi, a dairy plant located in Thai Nguyen province. This strategic move led to the establishment of the Elovi Vietnam joint venture, specialising in the production and distribution of flavoured milk and yogurt products.

Additionally, in the same year, Morinaga Milk Vietnam Co., Ltd. inaugurated an industrial cheese factory in the southern region of Vietnam.

As part of its comprehensive plan, the Morinaga Le May JV is projected to employ over 200 highly skilled professionals.

Morinaga Milk Industry Co., Ltd., established in 1917, is primarily engaged in the production and commercialization of dairy-based products. Its product range has gained prominence across Europe, the Americas, the Middle East, and Southeast Asia.

Vietnam-headquartered Lotus Group, founded in 1996, has grown into a prominent player in Vietnam's business landscape. With over 2,500 employees, the group has expanded its operations nationwide across four key sectors: food production and distribution, import and distribution of consumer goods, restaurant services, and retail.

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By Trung Duong

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