CHINA –Tokyo based instant noodles and frozen foods manufacturer, Nissin Foods has signed a cooperation agreement with Ms. LIU Feng, founder of the Dongfeng Group to form a joint venture company in China.

Nissin Foods said that the joint venture will strengthen its distribution platform in PRC market. The joint venture will set up a PRC Wholly Foreign-Owned Enterprise (PRC WFOE).

The companies intend to set up the business as a holding company, targeting to commence business by the second quarter this year.

Nissin Foods will contribute approximately HKD18.6 million (US$2.36m) in cash and hold an 81% stake in the joint venture company while Ms. LIU Feng will control the remaining 19% shareholding.

Both the joint venture and the PRC WFOE will be subsidiaries of the company, the results of which will be consolidated into the financial statements of the Group.

The main business of the joint venture will be to import and sell a comprehensive range of Japanese brand food and beverage products in first-tier cities including Shanghai in the PRC.

Mr. Kiyotaka ANDO, Executive Director, Chairman and Chief Executive Officer of Nissin Foods said that the JV will enable the Group to expand its distribution channels and provide more diversified range of food and beverage products.

“Formation of the JV is the Group’s latest initiative to diversify products and expand distribution channels in the PRC, and in the long run open new revenue streams for the Group,” Mr. Kiyotaka said.

“It will give us a stronger foothold in Shanghai, presenting us with long-term strategic value conducive to creating sustainable returns for our shareholders.

“It is also part of our localisation efforts to strengthen our presence and relevance in the PRC. In the way ahead, we will continue to look for opportunities in strategic partnerships or alliances, thereby fuelling growth momentum.”

The group believes such efforts will strengthen its knowledge of the PRC market and better prepare it for braving future market challenges.

Mr. YING Li Feng, Assistant Director of Nissin Foods (China) Holdings, will be appointed Chairman of the PRC WFOE while Ms. LIU Feng will be appointed a director of the PRC WFOE.