Mitsubishi Corporation announced on May 8, 2025, that it will undertake a tender offer buyout (TOB) for Mitsubishi Shokuhin, a major food wholesaler in which it holds a 50.11% stake, at a price of 6,340 yen per share. This strategic move aims to make Mitsubishi Shokuhin a wholly-owned subsidiary and is part of Mitsubishi Corporation's broader plan to strengthen its food distribution business.
The TOB is set to commence on May 9, 2025, and will run until June 19, 2025. The minimum number of shares to be purchased is 7.1 million, which corresponds to a 16.31% ownership ratio, while there is no upper limit on the total number of shares that can be acquired. If the buyout is successful, Mitsubishi Shokuhin is expected to be delisted from the Tokyo Stock Exchange around September 2025, following the completion of necessary procedures.
Mitsubishi Shokuhin has publicly expressed its support for the TOB, indicating a cooperative approach to this acquisition. The total purchase price for the planned acquisition is anticipated to exceed 137.7 billion yen, significantly enhancing Mitsubishi Corporation's control and synergy with the food wholesaler.
During an earnings briefing held on the same day as the announcement, Mitsubishi Shokuhin's President, Yutaka Kyotani, emphasized the necessity of adapting to current market conditions. He stated, "It has become difficult to foresee the times due to issues such as President Trump and tariffs, and changes in the market due to the declining birthrate and aging population in Japan." Kyotani noted that by becoming a wholly-owned subsidiary, Mitsubishi Shokuhin will integrate its strategies and management resources with those of Mitsubishi Corporation.
The integration is aimed at strengthening the logistics operations and expanding the overseas market for Japanese food products. Kyotani further elaborated on the goals set in the mid-term plan, "MS Vision 2030," which targets an ordinary income of 50 billion yen by fiscal 2030, a dividend payout ratio of 40% or more, and maintaining a return on equity (ROE) of 10% or more.
According to the company, the synergies expected from this acquisition include the expansion of revenue in the food wholesale business through digital utilization and collaboration, the enhancement of private brand (PB) development aimed at retail, and the development of overseas low-temperature logistics businesses leveraging Mitsubishi Corporation's global network. Additionally, there will be a focus on promoting human resource development and exchange.
Kyotani also highlighted the increasing importance of data and artificial intelligence (AI) in the business landscape. He stated, "Data and AI utilization have become indispensable to business, and we expect Mitsubishi Corporation's network to facilitate collaboration and business growth in the DD (Data x Digital) marketing business, which supports manufacturers and retailers in increasing sales."
Furthermore, to avoid any conflicts of interest, Kyotani and five other executives, including Executive Officer Yukio Tamura, did not participate in discussions regarding this TOB, as they are or were previously affiliated with Mitsubishi Corporation.
The Tokyo Stock Exchange has designated Mitsubishi Shokuhin's stock as a supervised stock, indicating that the exchange is monitoring the situation closely. This designation reflects the significance of the TOB and its potential impact on the market.
Mitsubishi Corporation's move to acquire Mitsubishi Shokuhin comes at a time when the food distribution sector faces numerous challenges, including labor shortages and the need for innovative solutions to adapt to changing consumer demands. By consolidating its operations, Mitsubishi Corporation aims to create a more resilient and agile food distribution business that can effectively compete in both domestic and international markets.
The acquisition is also seen as a strategic response to the evolving landscape of the food industry, where companies are increasingly looking to leverage technology and data analytics to enhance their operations and customer engagement. As the industry continues to evolve, Mitsubishi Corporation's efforts to integrate and strengthen its food distribution business may position it for long-term success.
In summary, Mitsubishi Corporation's announcement to acquire Mitsubishi Shokuhin through a TOB marks a significant step in its strategy to bolster its food distribution operations. With a clear focus on integration and innovation, the company aims to navigate the complexities of the current market and enhance its competitive edge.
