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Nongshim headquarters building. (Photo: Nongshim) |
[Alpha Biz= Paul Lee] SEOUL, July 22 – Nongshim is moving to acquire SaeWoo, a Korean seasoning and fermented food manufacturer, in a strategic move to strengthen synergies with its core food business, according to sources from the investment banking industry.
Nongshim Holdings, the holding company of the food and beverage giant, is reportedly in discussions to acquire SaeWoo for approximately KRW 100 billion (USD 72 million). In a disclosure filed with the Korea Exchange earlier today, the company stated, “We are reviewing the potential acquisition of SaeWoo as part of efforts to maximize synergies with our existing food business. No decision has been finalized.”
Founded in 1973 as textile company Daehan Textile, SaeWoo transitioned over the decades into the food industry. The company currently manufactures and supplies seasoning powders for instant noodles, as well as traditional Korean fermented sauces such as gochujang and doenjang.
In 2023, SaeWoo recorded revenue of KRW 136.8 billion, operating profit of KRW 10.5 billion, and net income of KRW 9 billion. At the current estimated acquisition price, the deal implies a price-to-earnings (PER) ratio of around 11x, lower than the industry average of 15x for listed Korean food and beverage companies.
SaeWoo is a family-run business with close ties to Nongshim Group Chairman Shin Dong-won. Approximately 60.24% of the company is owned by CEO Kim Chang-kyung, believed to be the son of Chairman Kim Jung-jo, who holds an 18.18% stake. Both individuals are known to be relatives on Chairman Shin’s maternal side. SaeWoo has a consistent history of high dividend payouts, distributing KRW 3.3 billion in 2023 and KRW 4.1 billion in 2022, with payout ratios of 36% and 59% respectively.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
