Asahi Brewery Co. President Hitoshi Ogita has expressed his intention to seek a business tie-up between soft drink affiliate Asahi Soft Drinks Co. and other makers in the industry.
Ogita revealed this during a recent interview with The Yomiuri Shimbun when he was asked about Asahi Brewery’s merger and acquisition strategy.
The Asahi Brewery president also indicated he would consider offers or proposals for its food businesses on a “case-by-case basis”.
The comments were given amid signs that the domestic market for alcohol and soft drinks is continuing to shrink, and after news that negotiations had started between Kirin Holdings Co. and Suntory Holdings Co. over a management integration deal.
Commenting on the possible Kirin-Suntory merger, Ogita expressed concern on Asahi’s part, saying the two companies’ business alliance “would leave us behind on all points–productivity and profitability, and on product development and sales capabilities”.
As an effort to compete with its rivals, the president said that Asahi “needs to increase the number of its soft drink vending machines (through M&A activity)”.
Tsingtao ties strengthened
Meanwhile, Asahi Brewery has announced that it will make Tsingtao Brewery in China an affiliate on an equity basis and that it had dispatched two of its executive board members there.
The two companies’ business alliance will then go into full-swing with the start of joint purchasing of materials–including wheat and hops–and the production of each other’s brand products.
In rural areas in China, where demand for beer is rapidly increasing, the two companies will promote sales of low-end Tsingtao beer products developed by the companies.