HiteJinro Co., a South Korean alcoholic beverage company, has signed a land agreement for its planned soju plant in Vietnam.
The agreement marks a major step forward for the project, which is expected to be operational by next year.
In its stock market filing on Tuesday, HiteJinro stated that its Vietnamese production subsidiary, Jinro Soju Vietnam, signed the land and infrastructure sublease agreement with Green I-Park Corporation, a Vietnamese company.
The contract is worth 191.2 billion dong ($7.79 million) in Vietnamese currency.
The plant will be built on a site of 82,083 square meters in the Green I-Park industrial park in Thai Binh province, near Hanoi.
HiteJinro is expected to start construction on the plant this year and begin operations in 2025.
This is the first time that HiteJinro, which is celebrating its 100th anniversary next year, has built a production plant overseas.
The company cited several reasons for the move, including the continued growth of the global soju market, the need to improve cost competitiveness, and the potential to launch local brands and products.
HiteJinro's soju exports have grown by an average of 15% per year over the past six years. The company expects overseas soju sales to triple by 2032.
Vietnam was chosen as the site of the new plant because of its favorable location, cost of living, access to logistics, and availability of labor.
Thai Binh province is located in northern Vietnam, close to Hanoi, and has well-developed infrastructure, including an international airport, seaport, and coastal highway.
The province's working-age population accounts for about 57% of the total population.
The park is a designated economic zone with good infrastructure, including an international airport, seaport, and coastal highway.
Write to Hyung-Joo Oh at
ohj@hankyung.com
