TOKYO -- Minimart operator Circle K Sunkus has left the overseas market by dissolving the partnership with its U.S. counterpart.
Circle K Sunkus created a 50-50 joint venture with Arizona-based Circle K Stores in 2013 called Circle K Asia, a brand management company tasked with expanding in Asia. Circle K Asia allied with local companies to open about 620 stores in Indonesia, Vietnam, Malaysia, the Philippines and Guam.
But Circle K Sunkus sold its stake in the venture to the U.S. company July 24. The exact transaction amount has not been disclosed, but it is estimated at over 1 billion yen ($8 million). Because the joint venture's earnings were seen as robust, Circle K Sunkus said it unloaded the stocks at higher than the initial investment.
The departure of Circle K Sunkus from foreign markets was driven by parent company Uny Group Holdings' merger talks with rival FamilyMart. The likelihood that Circle K Asia stores will compete with FamilyMart stores overseas was a main sticking point. The U.S.-based Circle K Stores also was concerned that its operating know-how would be leaked to FamilyMart.
FamilyMart has expanded aggressively in Asia. The company had 5,725 overseas stores -- many in Taiwan and China -- at the end of June with 1,383 of them in Southeast Asia, primarily in Thailand. It plans to open more shops in Vietnam, Indonesia and the Philippines. FamilyMart runs those stores with local companies that haven't partnered with Circle K Asia.
The U.S. company created Circle K Asia after seeing how Japanese expertise with convenience stores can be applied to developing the Asian market. After Uny and FamilyMart merge, resources will be poured into FamilyMart's overseas stores, broadening the footprint of Japanese-style minimarts.
The merger talks already have agreed that the Japanese stores will have a common marquee, and Uny appears to be pushing the deal along by divesting the overseas stores.