A fund run by Bahrain-based alternative asset manager Investcorp bought a stake in Heritage Foods, a Hong Kong-based maker of condiments and sauces.
The company did not disclose the size of the stake or the dollar value of its investment, which was made through the Asia Food Growth Fund I it set up in partnership with state-owned food distribution company China Resources and Fung Strategic Holdings, a member of Hong Kong-based Fung Investments.
"We believe that the Asia food sector continues to offer attractive growth opportunities and we see that Heritage Foods is poised to achieve significant scale," said Hazem Ben-Gacem, co-chief executive of Investcorp and chairman of the Asia Food Growth Fund's Investment Committee.
"We see attractive macro trends in Asia’s rising middle class, high household consumption of sauces and rapid growth in casual dining further driving market growth."
The global sauces and condiments market is worth about $130 billion and is growing at 5 per cent to 6 per cent a year, according to Investcorp. Asian sauces and condiments make up about half of the total market.
Investcorp, which had $35.4 billion of assets under management as of March 31, set up the $500m Asia Food Growth Fund in November 2019. The fund has already invested in Singaporean instant cereal maker Viz Branz and Hong Kong food retailer City Super Group.
Heritage Foods was set up in 2015 and has acquired sauce brands that have been around for much longer, including Japan's Hamada Shoyu (established in 1818), Singapore's Woh Hup Food (established in 1936) and Malaysia's Bidor Kwong Heng (established in 1945).
The company has manufacturing sites in mainland China, Japan, Singapore and Malaysia. It employs more than 300 people.
"The fragmented sauces and condiment market in Asia offers many exciting bolt-on acquisition opportunities to further our growth plans,” said Monica Tsui, managing director of Fung Investment Management.