South Korea: Hite Brewery and Jinro Ltd. to jointly set up bottled water business

The Hite Brewery Co., South Korea's largest brewery company, said on February 3 it plans to spin off its bottled water division to form a new water company with the nation's leading distiller Jinro Ltd. next month, according to Asia Pulse News.

The new entity will merge Hite's "Puriss" brand and Jinro's "Seoksu" brand, which hold 7.2 per cent and 11.1 per cent market share, respectively, as of last year, the company said. The combined market share would likely surpass the 12 per cent market share held by current market leader "Saemmul", produced by Dongwon F&B Co..

Hite intends to set up an independent company with one billion won (US$1 million) capital by spinning off its "Puriss" division and Jinro will follow suit, Hite said. "Hite's water division currently contributes 2 per cent of the company's total revenue," an official at the company said.

"The split will lead the division to improve its expertise in the bottled water area." Hite launched its water business in August 1996 by setting up an independent company. The firm was brought under Hite's wing in June 1999.

Hite Brewery, South Korea's largest brewer, bought Jinro for 3.43 trillion won in June in the nation's biggest ever corporate takeover.

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