Mondelez International, Inc. (MDLZ) Friday said that, as part of its efforts to focus its portfolio on snacking products, it has reached an agreement to sell its 50 percent interest in Ajinomoto General Foods, Inc. or AGF to its joint venture partner, Ajinomoto Co., Inc.
AGF manufactures and sells instant, ground and liquid coffee products as well as other beverages in Japan under brands mainly licensed by Mondelez International, including Blendy and Maxim.
Upon closing of the stock purchase agreement, Mondelez International will receive pre-tax cash proceeds of 27 billion yen. The transaction is scheduled to close by the end of April.
In 2013, AGF generated over 100 billion yen in net revenue. It has 700 full-time employees and two factories in Gunma and Suzuka, Japan.
In May 2014, Mondelez announced its intention to combine its coffee business with D.E Master Blenders 1753 to create the world's leading pure-play coffee company - Jacobs Douwe Egberts or JDE.
As part of this, Mondelez's Japan joint-venture partner, Ajinomoto, was invited to join JDE. During these discussions, Ajinomoto expressed interest in acquiring Mondelez's shares in AGF.
The AGF stock purchase agreement with Ajinomoto will not have any impact on the proposed JDE transaction, which is expected to close later this year.
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