Tsuruha turns to M&As amid department store dearth
Tsuruha Holdings, Japan’s largest holding company involved in the operation of drugstores, plans to expand in Thailand through a series of mergers and acquisitions (M&A).
Tatsuru Tsuruha, chairman of Tsuruha Holdings, said the company joined Saha Group to open Tsuruha shops in Thailand seven years ago.
The company has 17 shops in Bangkok and one each in Chiang Mai, Sri Racha, Pattaya and Suvarnabhumi airport.
The company reported a profit of 83 million baht in Thailand in its 2019 fiscal year, which concluded in May, its first year in the black.
Mr Tsuruha said the company wants to expand its Thai shops, but established department stores have no real estate left.
He said the high price of plots is causing a delay in Thai expansion plans.
“The company may need to use M&As to expand shops in Thailand,” Mr Tsuruha said.
Deputy Prime Minister Somkid
Jatusripitak visited Tsuruha’s headquarters in Sapporo, Hokkaido on Nov 7, where he suggested the company expand shops in Thailand.
Mr Somkid suggested the company use M&As as an alternative to expand its business, especially in areas around public transport and well-trafficked provinces like Phuket.
Mr Tsuruha acknowledged there may be obstacles in importing some products to sell in Thailand, such as food additives that would need approval from the Food and Drug Administration.
He said the company also plans to expand shops in other Asean markets in the next 2-3 years.
Mr Somkid authorised the Board of Investment and related agencies to help the company facilitate shop expansion in Thailand.
Tsuruha Holdings was founded in May 1929 and is the biggest producer of pharmaceutical products and cosmetics in Japan.
The company has 2,100 shops in Japan.
Through subsidiaries, the company is engaged in the sale of pharmaceutical products through pharmacies and stores located in Kanto, Chubu, Sanin, Hokkaido and Tohoku areas.
Tsuruha is also engaged in the wholesale of pharmaceutical products to franchised stores; the procurement of products; logistics; mail-order sales of products by telephone and internet; the insurance business; real estate listings; the leasing of vending machines; and beverage sales.
The company’s revenue in 2019 was
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The company may need to use M&As to expand shops in Thailand.
TATSURU TSURUHA Chairman, Tsuruha Holdings
¥4.1 billion, with ¥700 million in net revenue. It has 15,980 employees.
Mr Somkid urged the company to use Thailand as a gateway to expand business into Cambodia, Laos, Myanmar and Vietnam, all markets with growing middle classes.
He said the company should expand shops in urban areas, especially along electric rail and in major regions like
Phuket or Surat Thani.
Mr Somkid also suggested the company import One Tambon One Product products to sell in Tsuruha’s shops in Japan.