Pasco, Itochu Corporation, and Wei Chuan Corp., a subsidiary of Ting Hsin International Group, will jointly invest JPY1.1 billion to establish a joint venture in September 2008. Of the total investment, Wei Chuan, Pasco, and Itochu will contribute 60%, 24%, and 16%, respectively.
The factory of the joint venture, which is expected to be put into production in February 2010, is planned to be in Shanghai. The factory will manufacture Wei Chuan-Pasco bread brands, including sliced bread and Pasco bread snacks. These products will be sold in convenience stores and supermarkets.

A representative from Pasco said that the Chinese bread market has a great potential and the company is pleased to offer safe and high-quality bread products. This cooperation between Chinese and Japanese companies will form one of the biggest bread manufacturers in China and the goal of the joint venture is to become the leader in China’s bread industry.

The acquisition covers 17 retail stores and after the acquisition, Coach will directly manage its Chinese business. Prior to this, Coach acquired its retail businesses in Hong Kong and Macau from ImagineX Group on September 9, 2008. To date, Coach has 27 retail outlets in China.

Lew Frankfort, the chairman and CEO of Coach, said that so far the company has set up a local business team and completed a range of investigations on Chinese consumers. Coach plans to build China into its third largest market worldwide, after the United States and Japan.

Ian Bickley, the president of Coach International, revealed that the company plans to open over 50 new retails sites in China in the next five years to increase its sales and market share in this region. He added that Coach expects to increase its sales in China from the current USD50 million to USD250 million and raise its market share from 3% to 10%.