Seattle, Washington-based AquaStar, a top supplier of frozen seafood in North America, has entered into a joint-venture agreement to acquire an equity stake in shrimp producer Sagar Grandhi Exports, Ltd of India.
AquaStar and its subsidiaries have been the exclusive marketers of all Sagar products in North America since the Indian firm was founded in 1996. In an email to SeafoodSource, AquaStar co-founder and CEO Dirk Leuenberger did not disclose the size of the investment but said, “It is a significant investment between two privately-held, family-owned companies.”
Sagar Grandhi Exports is located in Chittedu, Nellore District, Andreh Pradesh, which Leuenberger called “a major source for shrimp raw material.” The area has more than 10,000 hectares of shrimp cultivation and averages more than 150,000 metric tons (MT) of shrimp production annually.
“The staggering number of farms under the Sagar umbrella helps us respond to customer demands consistently on a year-round basis, with the highest levels of certification and commitment to quality at all times,” Leuenberger said. “
AquaStar recently completed a second factory that has upped the company’s production capacity to 125 MT per day, tripling its previous total. The new facility, and the vertical integration with Sagar Grandhi, will give AquaStar diversified processing capabilities that include value-added products, shrimp rings, tempura, and breaded and battered shrimp. That ability to produce a wider range of value-added products at source was a key aspect of the deal, Leuenberger said.
“Our recent investment in Sagar Grandhi is a positive step toward our continued vertical integration in all the categories in which we produce and supply goods. It is also an indication of the direction we will continue to take in producing products at source,” Leuenberger said. “We are on a path together to continually add value to our customers and meet their go-forward requirements in every aspect.”
The Sagar Grandhi transaction is just one example of AquaStar’s efforts to vertically integrate its global supply chain, Leuenberger said.
“We have a great number of very collaborative partnerships around the world in varying degrees,” he said. “AquaStar and its corporate group are major seafood processors, producers and distributors of seafood throughout North America and Asia with operations on four continents in 12 countries. As AquaStar continues to and is able to provide a stronger value equation in our goods and services to the marketplace, our entire supply chain and all participating in it win together. Our hope is that this investment will only grow and add value to all of our suppliers and of course our customers commensurately as we continue to build our companies together on the merits of our best-in-class businesses.”
Sagar Grandhi owners Chella Rao Grandhi and Balaji Grandhi agreed AquaStar’s equity stake is representative of a trend amongst seafood marketers to get closer to their primary producers.
“The global marketplace wishes to work as closely with primary producers as possible and this partnership allows us to accelerate that process in North America particularly, as well as other parts of the world,” they said.
