KIDO Foods' trillion-dollar M&A deal has not been "smooth sailing": Nutifood only controls shares, KIDO declares it is still the owner of the Celano and Merino brands

Although the ownership ratio is no longer dominant, according to a KIDO representative, the Merino and Celano brands that KDF is using for business are still brands owned by the Group.

KIDO Group Corporation (stock code KDC) has just announced the draft of the extraordinary General Meeting of Shareholders, scheduled to take place on January 24, 2025. The main content of this meeting includes the business situation in 2024, submitting to shareholders for comments on the sale of 24.03% of capital at Kido Foods (KDF) to partners and information related to the Group's brands. In September 2024, Nutifood announced that it would become the parent company of Kido Foods (KDF) after completing the acquisition of 51% of the company's capital. Kido Foods is the company that produces and distributes the two ice cream brands Merino and Celano with the largest market share in Vietnam. Previously, in 2023, KIDO Group transferred 24% of KIDO Foods' capital, reducing its ownership ratio to 49%, thereby no longer holding control of this company. The transfer value is VND1,069 billion, equivalent to a company valuation of about VND4,450 billion (USD200 million). Although the ownership ratio is no longer dominant, according to a representative of KIDO, the Merino and Celano brands that KDF is using for business are still brands owned by the Group. In fact, Kido just received ownership of the Celano brand from Kido Foods in December 2023.

KDC's General Meeting of Shareholders will decide on the use of the Merino and Celano brands. Notably, in the draft of this General Meeting, KIDO has submitted the content of the General Meeting of Shareholders to consider and give further opinions on the transaction of selling 24% of KDF shares that has been implemented. According to the opinion of the Board of Supervisors, because the divestment of 24% of KDF's capital to reduce the ratio to 49% is the conversion of a subsidiary into an affiliated company and the fact that the affiliated company is using the brands owned by KDC is an important issue that needs to be considered and commented on by the General Meeting of Shareholders . The Board of Supervisors requested to bring this transaction to the General Meeting of Shareholders for discussion and voting. KDC also proposed that the General Meeting of Shareholders will authorize the Chairman of the Board of Directors to decide on specific terms, transactions, agreements, and negotiations with partners on transactions and related issues (contracts, agreements, documents, including amendments, supplements, terminations, and replacements related to this transaction). KDC's report stated that from 2022, KIDO has had a strategy to bring all brands from its subsidiaries to KIDO Group Corporation. Of which, 34 brands and trademarks from Kido Foods include the following brands/labels: MERINOX, MERINO YEAH!, MERINO SUPERTEEN, MERINO KOOL, CELANO, CELANO PLATINUM, M, WEL YO, WEL YO Beauty YOGURT, WEL YO Family YOGURT, HALLO.... were signed by Kido Foods to be transferred to KDC on June 30, 2022. After that, the Group will own and manage all brands and trademarks used at its subsidiaries and member companies. When KDC reduces its ownership ratio and Kido Foods becomes an affiliated company, the issue of exploiting and using brands such as Celano or Merino, according to KDC's board of directors, needs the General Meeting of Shareholders to give opinions on 3 contents, specifically: + Maintain ownership at the Group to protect brand value, protect the legitimate rights of the brand. + The right to use/authorize a third party outside of KDC and its subsidiaries to use. + Authorize the Board of Directors and/or the General Director of the Company according to the delegation of authority to decide on specific terms and sign, execute related transactions and contracts, agreements, documents related to related transactions, including agreements to amend, supplement, terminate, replace related transactions (if any) to the Celano/Merino brand.

Celebrity cast promotes Celano

Nutifood invests heavily in Celano brand after taking control of KDF. KDC's announcements show that although Nutifood is in control of KDF, if KDC does not agree, KDF may not continue to use the brands that this business is trading such as Celano or Merino. In the last months of 2024, after officially taking control of KDF, Nutifood invested heavily to promote the Celano brand. Especially the campaign using the top stars of the show Say Hi Brother to promote such as HIEUTHUHAI, Quang Hung MasterD, Duong Domic, JSOL and Hurrykng. Source: https://cafef.vn/thuong-vu-ma-nghin-ty-cua-kido-foods-chua-thuan-buon-xuoi-gio-nutifood-chi-kiem-soat-ve-co-phan-kido-tuyen-bo-van-la-chu-so-huu-cac-thuong-hieu-celano-merino-188250107085244216.chn