Ajinomoto buys into Africa with $532 million Promasidor stake

President of Japanese food manufacturer Ajinomoto Co Inc Takaaki Nishii poses in front of a display of his company's products at its headquarters in Tokyo September 1, 2015. REUTERS/Thomas Peter

(Reuters) - Japanese food and ingredients maker Ajinomoto 2802.T has agreed to buy 33 percent of Africa's Promasidor for $532 million, the latest step on its march toward becoming a top-10 global food company.

The news on Tuesday confirmed a Reuters' story earlier this month that said Ajinomoto was bidding against PepsiCo PEP.N and most likely to win.

The price values the whole of Promasidor at about $1.6 billion, which is 16 times Promasidor’s earnings before interest, tax, depreciation and amortization (EBITDA), according to estimates from sources familiar with the matter.

That is higher than other recent deals in the African food and drink sector, which have included the purchase of a stake in Nigerian drinks company Chi by Coca-Cola and in Nigeria’s Multipro by Kellogg, according to one of the sources.

Promasidor operates mainly in Nigeria, Algeria, Ghana, the Democratic Republic of Congo and Angola. It sells powdered milk and drinks, seasonings and other food products.

The stake gives Ajinomoto access to a large distribution network that spans 36 countries in Africa.

Reporting by Martinne Geller in London; editing by Jason Neely