Kagome, a Japanese producer of tomato-based processed foods, said on Friday that it will purchase a lactic beverage maker from Snow Brand Milk Products while studying a plan to invest in the struggling dairy product manufacturer, reports the Kyodo News.
Kagome said it will acquire all 280,000 shares in Snow Brand Labio from Snow Brand Milk for about 3 billion yen (€0.02bn) on 30 November. Approximately 300 employees of Snow Brand Milk's wholly owned subsidiary will move to Kagome.
Snow Brand Labio, a maker of lactic acid bacteria beverages, posted sales of 14.6 billion yen in fiscal 2001 (which ended in March) but stayed in the red for the second consecutive year.
According to the Kyodo News report, Kagome also said it will consider joining the National Federation of Agricultural Co-operative Associations and Itochu in buying 10 billion yen worth of new shares to be issued by Snow Brand Milk for private placement as part of its rehabilitation effort.
Kagome, added Kyodo, hopes to move into lactic beverages and other new markets by acquiring a stake in the Snow Brand group.