HiteJinro controls half of South Korea’s soju market
Oriental Brewery Co. (OB), a unit of the world’s largest beer company AB InBev, agreed on Wednesday to purchase Jeju Soju from Shinsegae L&B Co. in its foray into the traditional Korean distilled liquor market, the two companies said.
OB is setting its sights on the growing export market of soju as the vodka-like rice liquor is catching on in overseas markets with the popularity of K-pop and Korean food.
Soju is the most popular Korean alcoholic beverage among foreigners, showed a survey conducted by the Korean Food Promotion Institution in 2023.
Under an agreement, OB will take over Jeju Soju’s production facility and the land of the plant, as well as the right of using groundwater there, from Shinsegae for an undisclosed sum. OB will then absorb the spirits maker, founded in 2011.
In 2016, E-Mart Inc., a supermarket arm of Shinsegae Inc., acquired Jeju Soju for 19.0 billion won ($14.2 million) and has since poured 57.0 billion won into the loss-making soju maker.
But Jeju Soju, based on its eponymous island, has remained in the red under E-Mart. Over the past four years, Jeju Soju has accumulated losses of 43.4 billion won.
Kim Ji-won, who starred in the ‘Queen of Tears’ drama series, is an ambassador for Lotte Chilsung’s Chum-Churum soju
In the domestic soju market, HiteJinro controls 59.8% under its flagship brand Chamisul, followed by Lotte Chilsung Beverage Co. with a 18% share, according to Korea Agro-Fisheries & Food Trade Corp.
In 2021, E-Mart transferred Jeju Soju to its affiliate Shinsegae L&B. It has since discontinued producing the clear, clololess spirit under its brand and transformed into an original development manufacturer for soju exporters.
Soju exports surpassed $100 million in 2023, marking the largest overseas shipment of the alcoholic beverage in a decade.
Shinsegae L&B has sought to jettison the soju maker to restructure its business hit by the sluggish wine business.
By Sul-Li Jun
sljun@hankyung.com
Yeonhee Kim edited this article
