Expalsa feed division. (Photo: Expalsa)
Nutreco to take over 75pc of fish feed company
Tuesday, October 09, 2012, 00:10 (GMT + 9)
Nutreco has signed an agreement to buy 75 per cent of the shares in Expalsa group fish feed subsidiary Gisis SA.
As Expalsa is a market leader in fish feed production and shrimp and tilapia farming in Ecuador and possesses strong market positions in Honduras and Peru, the transaction takes Nutreco into the global top three shrimp feed suppliers.
The acquisition will be immediately earnings accretive.
Nutreco said the acquisition fully supports its strategy to broaden its fish feed business in growth geographies and non-salmonid species while maintaining its global leading position in salmon feed.
Associated aquaculture feed joint venture in Honduras with leading international tilapia producer Regal Springs, from Indonesia, offers Nutreco potential for continued growth in both Latin America and Southeast Asia. It is the world's first fish farming company certified by the Aquaculture Stewardship Council (ASC).
The acquisition of Gisis fortifies Nutreco's aquaculture feed business Skretting in Latin America, with production, sales and distribution plants for shrimp and tilapia feed in Ecuador, Honduras and Peru and a joint venture with Regal Springs in Honduras.
Expected revenues in 2012 are EUR 160 million compared to EUR 135 million in 2011. The total consideration for the acquisition of 75 per cent of the shares is about EUR 78 million.
Closing of the transaction is subject to gaining regulatory approval from the Ecuadorian competition authority.
Gisis produced around 200,000 tonnes of shrimp and fish feed in 2011.
The size of the shrimp feed market in Ecuador last year was estimated at 350,000 tonnes, ranking as number three in worldwide shrimp feed production.
The market has grown by approximately 8 per cent per year over the past five years and double digit growth is expected in 2012. Fish feed production in Ecuador is around 60,000 tonnes.
Nutreco's strategic target is to grow its fish feed business for non-salmonid species from 28 per cent in 2010 to 45 per cent of total fish feed volume by 2016; this acquisition will push the non-salmonid share of total fish feed volume to close to 40 per cent in 2013.
This acquisition will also boost the ability of Nutreco's fish feed business Skretting to build on its current presence in shrimp and tilapia feed in China, Vietnam and Brazil.
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By Natalia Real