Namyang Dairy Signs MOU at Korea-Vietnam Business Forum... Only Dairy Company in Economic Delegation

Unprecedented Accompaniment by Han & Company, a Private Equity Fund (PEF)

Expanding Exports Beyond K-Formula to Coffee and Protein Beverages

Namyang Dairy Products is accelerating its expansion into the Southeast Asian market by partnering with Phu Thai Holdings, a major Vietnamese distribution company. The strategy is to diversify beyond infant formula exports and broaden its portfolio to include coffee and protein foods.

On April 23, Namyang Dairy Products announced that it had signed a three-year strategic memorandum of understanding (MOU) with Phu Thai Holdings worth 70 billion won. The agreement was signed at the Korea-Vietnam Business Forum, held as part of the presidential economic delegation's schedule. Namyang Dairy Products was the only domestic dairy company included in the delegation.

Seung-eon Kim, President of Namyang Dairy Products (second from the left), Pham Dinh Doan, Chairman of Phu Thai Holdings, and Dongchun Lee, Vice President of Han & Company, are taking a commemorative photo after signing a business agreement at the Korea-Vietnam Business Forum. Provided by Namyang Dairy Products.

The signing ceremony was attended by Seung-eon Kim, President and CEO of Namyang Dairy Products; Dongchun Lee, Vice President of Han & Company and Outside Director of Namyang Dairy Products; and Pham Dinh Doan, Chairman of Phu Thai Holdings. From the Korean side, Kim Jung-kwan, Minister of Trade, Industry and Energy, attended, while from the Vietnamese side, Nguyen Van Thang, Minister of Finance, was present. Notably, Dongchun Lee of Han & Company accompanied the economic delegation as a member of the Namyang Dairy Products board. It is unusual for a private equity fund (PEF) executive to participate in an overseas business event of an investee company as a board member. This move is interpreted as a 'management partner-type investment' in which the investor is directly involved in establishing and executing global business strategies, going beyond the role of a mere financial investor.

The core of this agreement is market expansion using 'K-formula' as a bridgehead. Namyang Dairy Products plans to first build trust in the local market with its core product, infant formula, and then expand its business areas to include all dairy products, coffee, and protein foods. The scope of cooperation includes not only infant formula but also processed foods such as 'French Cafe' and 'Takefit.'

The distribution strength of the local partner is also seen as a major advantage. Phu Thai Holdings is a large distribution company with 160,000 retail stores, over 1,000 supermarkets, more than 2,000 convenience stores, and 2,500 wholesale channels across all 63 provinces and cities in Vietnam. In particular, since the Vietnamese infant formula market still maintains an offline-centric structure, dominance in traditional markets and baby shop channels is considered a key competitive edge.

Namyang Dairy Products entered the Vietnamese market in January after signing an infant formula export contract with Phu Thai Holdings. The company has since successfully established an initial foothold by expanding its distribution network, focusing on traditional markets and baby shops. A company spokesperson said, "For infant formula, trust in quality and safety is the decisive factor for purchases. Securing initial trust is creating a virtuous cycle that drives repeat purchases and distribution expansion."

This strategy has already been proven in the Cambodian market. Namyang Dairy Products has secured about a 90% market share based on Korean formula standards by targeting the local market with its own infant formula brand 'Imperial XO' and operating the local ODM (Original Design Manufacturing) brand 'Stargrow.'

Seung-eon Kim, President and CEO of Namyang Dairy Products, stated, "The cooperation that began earlier this year with 100% domestically produced raw milk-based infant formula has established a foundation in the Vietnamese market, and with this business agreement, we are now entering a stage of expanding from K-formula to all K-foods. Based on trust, we will make Vietnam the core export hub for Southeast Asia through a diverse range of dairy products."

This content was produced with the assistance of AI translation services.