Shiseido to start Operations in Turkey

"Shiseido Co., Ltd has established Shiseido Kozmetik Anonim Şirketi (named “Shiseido Turkey”; located in Istanbul, Turkey) as a joint venture with major Turkish cosmetics import and sales distributor Vesco Kosmetik Ürünleri Paz. ve Tic. Ltd. Sti. (“Vesco”; located in Istanbul, Turkey)," the company informed.Operations of the new company will commence from January 2012. With Shiseido possessing a majority equity stake in the joint venture, the company will become a consolidated subsidiary of Shiseido and global brand SHISEIDO prestige cosmetics products commonly developed worldwide by Shiseido will be sold.

Initiatives in the Overseas Cosmetics Business

Shiseido is currently promoting a 10-year roadmap established in 2008 with the aim of becoming a “global player representing Asia with its origins in Japan” by 2017. The overseas sales ratio for the previous term (fiscal year ended March 2011) increased to 42.9% and the number of countries and regions in which Shiseido operates its global business is expanding to 87 countries and regions, including Japan. In recent years, Shiseido has been promoting initiatives to strengthen its business scheme. Specifically, the Company commenced operations by establishing wholly owned sales companies in Russia in 2008 and Vietnam and Switzerland in 2010, as well as by launching business operations in Greece by establishing a joint sales company with a local leading distributor in 2010. Shiseido has devised the New Frontier Strategy under its current Three-Year Plan (April 2011 - March 2014) and is seeking to strengthen its response toward emerging countries (new markets) as
a means of developing the next growth engine following China.

Background to Establishing a Joint Venture

Shiseido entered the Turkish market in 1998 through an agreement with Vesco, a distributor that the Company has formed a partnership at this time. Based on an amicable partnership with the company for more than 10 years, Shiseido has been promoting prestige marketing similar to European markets. As a result, the sales network of Shiseido cosmetics products has been expanded to approximately 170 stores and has steadily achieved sales growth.

At the same time, in terms of Turkey’s economy, demand for cosmetics products is expanding due to the expansion of domestic consumption accompanied by the population’s extremely young average age of approximately 29.2 years along with a rise in income.

“Consequently, the prestige cosmetics market is expected to continue to achieve high growth in the future. Therefore, in order to further strengthen its presence in the market, Shiseido
decided to establish a joint venture with Vesco, which has an outstanding proven track record in terms of sales know-how of prestige cosmetics,” the company stated.

Overview of Joint Venture

1) Company name: Shiseido Kozmetik Anonim Şirketi (Shiseido Cosmetic Joint Stock Company) referred to as “Shiseido Turkey”
2) Location: Istanbul, Republic of Turkey
3) Main business: Import and sale of global brand SHISEIDO prestige cosmetic products in Turkey
4) Capital: 4.6 million Turkish Lira
5) Investment ratio: Shiseido Group (with Shiseido International Europe S.A. as the largest shareholder) 51%; Vesco Kosmetik Ürünleri Paz. ve Tic. Ltd. Sti. 49%
6) Representative: Mr. Murat USTA

About Shiseido and Vesco

・Shiseido International Europe S.A.
1) Company name: Shiseido International Europe S.A.
2) Location: 11, Rue du Faubourg Saint-Honoré 75008 Paris, France
3) Main business: European holding company of the Shiseido Group
4) Capital: 256,133,010 euros (wholly owned subsidiary of Shiseido)
5) Representative: Mr. Yu Okazawa

・Vesco Kosmetik Ürünleri Paz. ve Tic. Ltd. Sti. (Vepa Vesco Cosmetics)
Vesco Kosmetik Ürünleri Paz. ve Tic. Ltd. Sti. is under the umbrella of the Vepa Group established in 1962 (a leading Turkish sales company handling various items from prestige cosmetics to sports apparel). The company started handling foreign-affiliated cosmetic brands for the first time ever in Turkey in 1988 and is recognized as a long-established distributor of cosmetic products.