OREANDA-NEWS. Sumitomo Corporation and Nissin Sugar Co., Ltd. will have equity participation in Kaset Thai International Sugar Corporation Public Company Limited, a leading sugar manufacturer in Thailand.

Sumitomo Corporation and Nissin Sugar will invest in a company that has been established by the family of the Kaset Thai founder for the purpose of investing in Kaset Thai. This joint company will acquire shares of Kaset Thai in stages, and after Kaset Thai is listed on the Stock Exchange of Thailand, is planning to hold 25% ownership eventually. The stake of Sumitomo Corporation and Nissin Sugar in the joint company after all their investment process will reach 25% and 5%, respectively. Their total investment amount is expected to be approximately 2.6 billion baht.

Kaset Thai is the third largest sugar manufacturing group in Thailand, collecting and processing about 10 million tons of sugarcanes—equivalent to approximately 10% of the country’s total sugarcane production—across the group in its factories in Nakhon Sawan and Uttaradit provinces in northern Thailand. In addition to its primary business of sugar manufacturing, Kaset Thai also produces ethanol and pulp, which are by-products from sugarcane processing, and is planning to launch a biomass electric generation project.

Thailand is the second largest sugar exporting country, next only to Brazil, and has the geographical advantage of being located at the center of rapidly growing Southeast Asia. For this reason, Sumitomo Corporation and Nissin Sugar have positioned Thailand as a strategically important area for their sugar business. Although the companies have focused mainly on trading until today, they will also be committed to—through the equity participation in Kaset Thai—supporting the enhancement of management quality of Kaset Thai as its strategic partners by leveraging Sumitomo Corporation’s expertise on overseas business management and global trade capabilities as well as Nissin Sugar’s knowhow on sugar refining and multiple-item production accumulated in Japan. Sumitomo Corporation and Nissin Sugar will work together to expand business in Southeast Asia.