Tingyi (Cayman Islands) Holding Corp’s (康師傅控股) Taiwan depositary receipts (TDR) yesterday slid 0.51 percent to NT$19.40 in Taipei trading after the company — the parent of China-based Master Kong Holdings (康師傅) — on Monday confirmed that it was dissolving its Taiwan operations.
Ting Hsin International Group (頂新集團), which was involved in a series of food scandals in 2014 and 2015, was in charge of Master Kong’s instant noodle business in Taiwan.
The group’s board of directors has approved a plan to completely withdraw from the Taiwanese market, Ting Hsin’s vice president for public affairs Chia Hsien-der (賈先德) told reporters on Monday.
The dissolution would not affect the company’s TDR trading on the Taiwan Stock Exchange, Chia said.
Master Kong still needs to finish liquidating its assets and to submit an investment withdrawal application to the Investment Commission to complete its dissolution, the Ministry of Economic Affairs said.
A company official, who declined to be named, yesterday said that the China-based instant noodle brand had terminated its production contract with the group’s Wei Chuan Foods Corp (味全食品) after a series of oil safety scandals that sparked a boycott of Ting Hsin food products.
Master Kong stopped distributing its instant noodles in Taiwan in 2015, the official said by telephone.
“Master Kong has no plans to step into the Taiwanese market again in the near term,” he said, citing fierce market competition.
As for its China business, the official said that the company is also facing tough challenges because of weakening demand for instant noodles.
In the first three quarters of last year, Master Kong’s revenue fell 9.44 percent to US$6.91 billion from a year ago and its net profit plunged 37.85 percent to US$213 million.
The Chinese instant noodle industry’s revenue is estimated to have declined by 2 to 3 percent last year, the official said.
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