FamilyMart threatened by partners’ tussle
TOKYO: FamilyMart, the most successful Japanese conveniencestore chain in China, is embroiled in a royalty payments fight between its Japanese and Chinese joint-venture partners that could scuttle the partnership.
FamilyMart UNY Holdings Co was suing to end its Chinese FamilyMart partnership with Ting Hsin International Group, saying the Taipei-based conglomerate hadn’t fairly shared the gains from the chain’s rapid expansion, said sources.
Under the terms of the partnership, Ting Hsin effectively operates more than 2,500 FamilyMart stores in China, sharing profits and paying royalties to the Japanese company.
Although Ting Hsin’s founders are Taiwanese, the company has had a presence in China since the late 1980s and is considered a local entity.
FamilyMart had filed a petition to a court in the Cayman Islands — where Ting Hsin and the joint venture are registered — to force its partner to relinquish its 60 per cent stake, said the sources.
FamilyMart UNY’s stock dropped 2.2 per cent in trading, here, yesterday to reach its lowest level in five weeks.
The tussle comes as China’s convenience-store market was set to grow by more than 60 per cent in the next five years to US$27 billion (RM112.6 billion), said Euromonitor International.