A new investment firm focused on the aquaculture and seafood industry is seeking investment opportunities globally.
New York, N.Y., U.S.-based Pontos Aqua Holdings, which was formed in May by investment partnership Tinicum L.P., is seeking commercial aquaculture and seafood investments in the range of USD 5 million (EUR 3.9 million) to more than USD 75 million (EUR 58.2 million) each.
“Our focus is on finding high quality businesses, or those that are positioned to become such and ones that can scale up to larger sizes throughout the industry value chain,” Pontos Aqua CEO Francisco Saraiva Gomes (pictured), told SeafoodSource.
The investment company is seeking businesses that are or that can become franchise-like — companies that have high barriers to entry, robust profitability and sources of competitive advance. “Pontos Aqua looks for companies that can be expanded vertically and horizontally and ones that bring additional efficiencies to the segments in which they operate,” Saraiva Gomes said.
Since the company began seeking aquaculture-related firms in which to invest in early August, it has received several applications and Pontos Aqua has made outreach trips throughout North America, Europe and Asia.
The investment company’s model is unique in that it not only provides capital, but it partners with aquaculture firms’ management teams throughout the growth process. “This is a longer-term approach, not a quick in-and-out investment model. We can stay with our investments as long as they make sense financially. We want to be real partners to management teams and help them with strategic decisions, bringing value in access to markets, technology, expertise in corporate structure and product marketing. We want to bring our portfolio companies more than just capital,” Saraiva Gomes said.
While Pontos Aqua executives are open to investing in any category of aquaculture-related businesses, there are certain “trends in the industry that have captured our attention,” said Saraiva Gomes.
One fast-growing sector of the aquaculture industry that Pontos Aqua is interested in is fishmeal and the refinement of ingredients from fishmeal. “We are looking at the higher end of the fishmeal sector that can differentiate themselves from the feed market,” Saraiva Gomes said.
Pontos executives are also interested in other aspects of the value chain, such as functional feeds, pharmaceuticals, equipment and engineering, risk management and selected aspects of farming operations, even though the latter is a “riskier” sector.
“There are very strong opportunities for investment. We recognize some signficant opportunities in farming operations, namely offshore production and ancillary businesses such as genetic selection, domestication and hatchery operations,” Saraiva Gomes said. “These represent key aspects of the industry that have not yet scaled up and where we believe we can bring meaningful value to management teams.”
Pontos may also invest in aquaculture firms involved with processing and marketing. “Our value chain approach allows us to look to businesses that have no production assets, but have strong franchise positions in exploring the secular trends that affect seafood in general,” Saraiva Gomes said.
