Mitsubishi Corp. (8058), Japan’s biggest trading house by market value, offered to buy meat products retailer Yonekyu Corp. (2290) for as much as 17.7 billion yen ($197 million) as it seeks to bolster income from businesses outside raw materials.
The trader offered 950 yen for each Yonekyu share it doesn’t already own and may delist the seller of hams and sausages, it said today in a statement to the Tokyo Stock Exchange. The offer is at a 28 percent premium to Yonekyu’s closing price of 743 yen today.
Mitsubishi, which is Yonekyu’s biggest shareholder with a 23.55 percent stake, is expanding in businesses such as food, retail and transport to counter volatile earnings from coal, iron ore, crude oil and natural gas that are prone to price and demand fluctuations. Mitsubishi and BHP Billion Ltd. each own half of the world’s biggest coking coal exporter.
Yonekyu today cut its net income forecast for the fiscal year ending Feb. 28 by 92.5 percent to 30 million yen. The company on Jan. 7 reported a 670 million yen loss for the nine months to Nov. 30, citing worsening consumer demand and growing competition that led to a drop in prices.
Last month, Mitsubishi said it plans to set up a shrimp business with Thai Union Frozen (TUF) Group in Thailand. Since 2010 the trader has invested in meat and livestock in China with Cofco Corp., entered the salmon farming business in Chile and added grain collection and coffee plantations in Brazil.
Metals and energy accounted for 64 percent of Mitsubishi’s 453.9 billion yen net income for the year ended March 31. Consumer goods made up 12.4 percent.
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