BioMar acquires majority of leading Ecuadorian shrimp feed producer
BioMar Group is looking to make a bold entrance into the shrimp feed sector with a 70 percent acquisition of Ecuadorian shrimp feed producer Alimentsa for USD 119 million (EUR 105 million), the company announced on 2 June.
As a means to establish itself among the leading shrimp feed producers in Latin America, BioMar hopes this latest acquisition of Alimentsa will also create synergies toward existing business, it said in a press release. The company aims to create a solid foothold in Ecuador with the transaction, which is one of the world’s leading shrimp-producing countries, generating a volume of more than 450,000 metric tons of shrimp.
“It is our ambition to become a major player within high-end shrimp feed,” BioMar CEO Carlos Diaz said. “With the acquisition of Alimentsa, we can immediately deliver an attractive value proposition to the shrimp farmers in Latin America and we believe that we in the future – together with Alimentsa and the customers – can develop new product solutions based upon shared interest in innovation, cooperation, sustainability and performance.”
Alimentsa holds a current market share of around 12 to 15 percent, and BioMar expects the shrimp feed production market to grow at an annual rate of 8 to 12 percent moving forward. Ecuador’s shrimp production is characterized by "optimal conditions that allow up to three production cycles per year," noted BioMar, and farming densities within the country are quite low compared to other markets, which facilitates more sustainable sanitary conditions, it said. Overall, the acquisition represents an investment of USD 119 million (EUR 105 million), explained the company.
“During our due-diligence process we have been confirmed that the acquisition will enable us to build a strong relationship towards the Latin American shrimp farmers. Alimentsa is recognized for high-end feed and a professional technical service. That is very much in line with our focus in BioMar.” Diaz said. “We foresee a solid business potential in Ecuador, but first and foremost we believe that the combination of a strong local company with recognized products and deep insights into the market together with a global company with the size and innovation muscle as we have in BioMar Group will enable us to meet the future requirements of the market as well as the end-consumers. We are very confident in the local management and the organization."
The Alimentsa acquisition comes after a period of strategic expansion for BioMar, according to the company’s CEO.
“We have during the last years expanded the business significantly. In 2016, we established production in Turkey. In 2017, we are forming a solid footprint with two factories in the Chinese market and in 2018 we have planned and announced the construction of a green field factory in Australia. Now we are taking a leap into the world of shrimp. All of those initiatives are a part of our growth strategy: Shaping the Future. We believe in being 100 percent devoted to aquaculture and we have clearly stated that we strive to be innovators dedicated to an efficient and sustainable global aquaculture,” Diaz concluded.
The acquisition is subject to approval by Ecuador’s competition authorities.