BANGKOK -- Thai consumer goods conglomerate Saha Group and Japan's Seino Holdings will form a joint distribution business with an eye toward regional expansion, Saha announced Friday.
Seino-Saha Logistics will be set up in September. Saha will contribute 39% of the 20 million baht ($590,000) in capital, while logistics company Seino will supply 51%. The joint venture will use Saha's domestic warehouses to build a distribution network in Thailand, initially handling food and household products made by Saha.
Plans are to have the venture form partnerships with other businesses and tap into the growing demand for logistics services in the Association of Southeast Asian Nations. Seino-Saha will aim to take in 5 billion baht in five years.
Saha has around 300 companies under its umbrella. Many are joint ventures with Japanese businesses, including health products manufacturer Lion and apparel maker Wacoal Holdings. Saha also has three distribution companies but partnered with Seino to develop more in-depth logistics expertise in expectation of greater regional economic integration after the ASEAN Economic Community is formed at the end of the year.
"Laying out a strong distribution network will be indispensable as we expand throughout the ASEAN countries," Saha Group Chairman Boonsithi Chokwatana told a news conference here.
Thailand will be Seino's second Southeast Asian outpost, after Malaysia. President Yoshitaka Taguchi said the country will become a "modern distribution hub for Asia" and affirmed Seino's desire to be a player in the region's logistics industry and partner with such Japanese businesses as automakers.