Daesang acquires Lucky Foods to make more kimchi in US
Daesang's kimchi factory in Los Angeles / Courtesy of Daesang
By Kim Jae-heun
Daesang has acquired U.S. food firm Lucky Foods to boost its sales of kimchi in the world's largest economy as part of its global expansion plan, Korea's largest kimchi maker said Monday.
The company purchased a 100 percent stake in Lucky Foods and all of its facilities for 38 billion won ($29.6 million), raised through a paid-in capital increase in March.
Founded in 2000, Lucky Foods specializes in producing Asian foods, including kimchi, which accounts for about two-thirds of its business. It is also diversifying its business into various products such as home meal replacements, Korean sauces and spring rolls.
“We will accelerate the expansion of the kimchi business in the U.S. market through the acquisition by utilizing Lucky Foods' product power and its infrastructure in the States,” a Daesang official said. “We are planning to strengthen marketing and research and development for our products in the U.S. too.”
Daesang will also make additional investments in Lucky Foods to expand its factories with an aim to double the production capacity of Seoul Kimchi products in the U.S., which have shown prominent growth.
The company is planning to establish core businesses in all food categories that are based on Korean traditional foods including kimchi and gochujang (red pepper paste).
Daesang is the country's biggest kimchi exporter, accounting for half of the $141 million total exports last year. In the same year, the company became the first Korean firm to build a kimchi factory in the U.S., located in Los Angeles.
It is currently exporting kimchi to 40 markets around the world, including the Americas, Europe, Taiwan and Hong Kong.