INDONESIA – Suntory Beverage & Food (SBF), the Japanese soft-drinks and food giant, has announced the sale of its 75% stake in Suntory Garuda Beverage, its Indonesian non-alcoholic beverage business, to partner Garudafood.
The deal, agreed upon by SBF’s board of directors on December 28, is expected to be completed in the first half of 2024.
In a stock-exchange statement, publicly-listed SBF stated that the divestment aligns with its strategic decision to “focus primarily on the health enrichment category in Indonesia.”
According to the company, the move is part of its ‘continuous portfolio review’.
Suntory Garuda Beverage, a joint venture established in 2011 by Suntory Beverage and the Garudafood group, engages in the manufacturing, bottling, and distribution of non-alcoholic beverages in Indonesia.
Suntory Garuda Beverage produces a range of beverages across facilities in Indonesia, specifically tea and jelly drinks.
Garudafood is one of the biggest food-and-beverage businesses in Indonesia, with products ranging from biscuits and nuts to salad dressing and milk drinks.
The company reported approximately US$70 million in revenue in 2022. The remaining shares in Suntory Garuda Beverage are held by PT Domulyo Maju Bersama (21.4%) and PT Sentosa Teknik Mandiri (3.6%).
SBF assured that the sale will have “minor impacts” on its consolidated business results.
As of the nine months ending September 30, 2023, SBF reported a revenue of Y1.1 trillion (US$7.7 billion) and a profit of Y83.7 billion.
Suntory’s Asia-Pacific business, excluding Japan, contributed about 19% to sales in 2022 and about 31% of profit in 2021.
This move follows Suntory Holdings’ restructuring last year, eliminating its global ready-to-drink (RTD) development department. The company established Suntory RTD Company to accelerate growth in the global RTD market, appointing Sho Semba as CEO.
Looking forward, the Carbonated Soft Drinks market in Indonesia is projected to grow annually by 4.3% (CAGR 2024-2027), reaching 5.6 billion liters by 2027 as forecasted by Statista.
The market anticipates a volume growth of 4.3% units in 2025, driven by increasing demand for local flavors and innovative packaging designs.
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