CJ CheilJedang divests Chinese subsidiary Jixiangju for $235 mn

South Korean food giant CJ CheilJedang Corp. announced on Monday that it has completely sold its ownership stake in its Chinese food subsidiary, Jixiangju Food.

The selling price for the divestment amounted to about 300 billion won ($235 million). The buyers of the stake include multiple Chinese institutional investors and Jixiangju Food's existing secondary shareholder.

Previously, CJ CheilJedang had acquired a total of 60% of Jixiangju Food's shares on two separate occasions in 2011 and 2016, for a combined sum of about 38.5 billion won.

In the past year, Jixiangju Food's revenue was 209.1 billion won.

CJ CheilJedang has operated its Chinese food business based on two subsidiaries, Qingdao Food, and Jixiangju Food.

Qingdao Food produces and sells K-food, including Bibigo frozen foods and Dashida (beef soup stock), while Jixiangju Food handles Chinese side dishes like zhai cai (pickled mustard greens) and Chinese sauces.

With the divestment, CJ CheilJedang is now focusing on expanding its K-food business, centered around the popular Bibigo brand. It will also strengthen its global strategic product business, including products such as laver, dumplings, and sauces, which achieved sales of approximately 165 billion won in China last year. Additionally, the company plans to enhance its online channels.

"We are expanding our food business globally, with a focus on K-food strategic products, and we aim to bolster our competitiveness in China accordingly," a CJ CheilJedang source said. "The proceeds from the sale will primarily be utilized to strengthen our financial soundness."

Write to Kyeong-je Han at hankyung@hankyung.com