Tokyo, Japan-headquartered Mitsui & Co. has signed a joint venture agreement with SATS Ltd., a major Singaporean-based airline service provider. It will invest approximately. ¥4.0 billion (US $25.5 million) for a 15% stake to participate in the business operations of SATS subsidiaries engaged in food manufacturing and distribution in India, Thailand, China and Singapore. One of the core activities of SATS is inflight catering, in which Mitsui will collaborate to expand its frozen foods and ready-to-eat products operation.
This deal follows an earlier strategic memorandum of understanding between Mitsui and SATS, signed in April of 2023, to create a joint venture to manufacture and distribute food products in Asia and beyond.
The Asian region is home to approximately 4.3 billion people, accounting for about 50% of the world’s population. The growth of its middle class is driving a trend of more sophisticated and diversified diets, leading to increased demand for frozen foods and ready-to-eat products – and this market is expected to continue to expand.
Meanwhile, the Covid-19 pandemic has heightened public awareness of food hygiene and health in Asian countries, resulting in a growing demand for safe, tasty and affordable value-added foods. This trend is expected to accelerate in step with economic growth, and Asia is seen as having the potential to become an even larger consumer market in the future.
With the acquisition of Paris-headquartered Worldwide Flight Services in April of 2023, SATS has expanded its presence globally, including to Europe and North America. Its core operations — air cargo terminal operations and inflight catering— are active at over 215 locations in more than 27 countries. At Singapore’s Changi Airport, which is a major Asian gateway, SATS supplies inflight meals to Singapore Airlines as a major customer.
With a strong commitment to food quality, SATS has developed high standards of food safety and expertise and capabilities in many areas from its inflight catering business. These include advanced freezing and refrigeration technologies, and an extensive knowledge of regional dietary customs and religious requirements, such as halal food. This gives the company capacity to deliver 800 different meal menu options per week and serve 120,000 inflight meals daily.
Through its investment in SATS, Mitsui aims to establish a stronger presence in Asian markets, with a particular focus on India and China, for value-added food products by leveraging its expertise in global procurement of food ingredients and packaging materials, cold chain logistics, distribution and marketing.
