Nutreco has signed an agreement to acquire 75% of the shares in Gisis S.A., the fish feed subsidiary of the Expalsa group in Ecuador and specialised in shrimp farming.
Expalsa is a market leader in fish feed production and shrimp and tilapia farming in Ecuador and has strong market positions in Honduras and Peru.
The acquisition of Gisis takes Nutreco into the global top three shrimp feed suppliers. The acquisition will be immediately earnings accretive.
Also included in the deal is an associated aqua feed joint venture in Honduras with leading international tilapia producer Regal Springs from Indonesia provides potential for further growth in Latin America and Southeast Asia.
This acquisition strengthens Nutreco's aquaculture feed business Skretting in Latin America, with production, sales and distribution facilities for shrimp and tilapia feed in Ecuador, Honduras, and Peru and a joint venture with Regal Springs in Honduras.
Expected revenues in 2012 are €160 million (2011: €135 million). The total consideration for the acquisition of 75% of the shares, including corresponding net debt, is approximately €78 million.
Market leader in Ecuador
Gisis employs approximately 400 people and has two feed production plants in Guayaquil, Ecuador. It produced around 200,000 tonnes of shrimp and fish feed in 2011 and 70,000 tonnes of other feeds, including 50,000 tonnes of poultry feed.
The size of the shrimp feed market in Ecuador in 2011 is estimated at 350,000 tonnes. Ecuador ranks as number three in worldwide shrimp feed production after China and Thailand.
Over the past five years the market has grown by approximately 8% per year and double digit growth is expected in 2012. Fish feed production in Ecuador is around 60,000 tonnes.
Part of the acquisition comprises a joint venture with Regal Springs in Honduras which is currently building a fish feed plant.
Regal Springs is a leading tilapia farmer in Indonesia with operations also in Mexico and Honduras and is the world's first fish farming company certified by the Aquaculture Stewardship Council.
Nutreco and Regal Springs will study further strategic relationships in Mexico and Indonesia upon closing of this transaction.
Nutreco’s strategy is to expand its fish feed business into growth regions important for aquafeeds; notably for shrimp and non-salmonid fish species. The company is already a global leader in salmon feeds.
The strategic target is to grow its fish feed business for non-salmonid species from 28% in 2010 to 45% of total fish feed volume by 2016. This acquisition will increase the non-salmonid share of total fish feed volume to close to 40% in 2013.
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