No.9147   2005. 6. 3

Suntory Completes Plant at Suntory (Shanghai) Foods, Co., Ltd., Second Soft
Drink Production Plant in Shanghai
-Facility to handle beverage production from R&D to manufacturing and quality assurance -

Suntory Limited celebrated the completion of its long-anticipated second soft drink production plant in Shanghai, China on June 3. The plant is known as Suntory (Shanghai) Foods, Co., Ltd.

The newly completed Suntory (Shanghai) Foods, Co., Ltd. complements the previously built Shanghai Suntory-Maling Foods Co., Ltd. plant and will produce oolong tea, functional beverages and other soft drinks. First-year production capacity will be 2.5 million cases, which will grow to 7.5 million cases in the future. Major factory equipment has been procured directly from local manufacturers (*except for the oolong tea extractors, which are made in Japan) and was designed to conserve energy. Systems like bottle washers and steam drain recovery units have been chosen to save water and steam.

In addition, the Suntory (China) R&D Center/Suntory (China) Quality Assurance CenterChina was instituted on the plant's grounds in August 2004 prior to the completion of the plant to establish a beverage production system capable of handling all steps of the production from R&D to manufacturing and quality assurance. To offer greater customer satisfaction, this center will procure locally available ingredients to develop products better meeting local consumer needs and will be outfitted with a thoroughgoing quality control system to build quality into products that are safe and inspire confidence in the brand.

With the completion of this new plant, Suntory looks forward to actively developing its business in the growing beverage market of Shanghai and surrounding area and from there anticipates further development of its soft drink business in China.

"Suntory's soft drinks business in Shanghai"
Suntory established Shanghai Suntory-Maling Foods Co., Ltd. in December 1995 as an equity joint venture with Shanghai Maling Food Co., Ltd., one of China's leading food products manufacturers (it became a contractual joint venture in 2003). A food products plant was completed the following year. The company started selling oolong tea, orange juice and other products in 1997, primarily in the Shanghai area, and sales of functional beverages began in 2000. Suntory (Shanghai) Foods, Co., Ltd. was established in October 2003 as a contractual joint venture with Shanghai Suntory-Maling Foods Co., Ltd., Suntory (China) Holding Co., Ltd. and Shanghai Maling Aquarius Co., Ltd. in order to build the recently completed factory. Sales of soft drinks in the Shanghai market have reached 3.9 million cases per year as of 2004.

▼Overview of Suntory (Shanghai) Foods, Co., Ltd. (as of June 3, 2005)

▼Location: No. 600 Chuanqiao Road, Jinqiao Export Processing Zone, Pudong New Area, Shanghai China

▼Company representatives: ShinsukeSengi, Chairman, and Osamu Noguchi, General Manager

▼Investment: US$15.6 million

▼Site area: 42,639m2

▼Production capacity: 2.5 million cases/year

▼Product categories produced: “SuntoryOolong” (oolong tea)

“Suntory Super Ultima”(functional beverage)

“Suntory Bing Oolong”(Lemon Flavored Tea)

▼Employees: About 70

▼Plant completed: June 2005

Overview of China (Shanghai) R&D / QualityAssuranceCenter(as of June 3, 2005)

▼Location: On grounds of Suntory (Shanghai) Foods, Co., Ltd.

▼Building area: 1,500m2

▼Employees: 24