London, United Kingdom-headquartered global investment firm Permira has taken a 50 percent stake in one of the largest aquafeed producers in Asia.
Tao-Yuan City, Taiwan-based Ye Cheng Industrial Products Co. which trades as Grobest, has operations in Taiwan, Vietnam, Thailand, China, India, Indonesia, Philippines, and Malaysia. It is a leader in Asia in producing “an array of innovative and differentiated functional feed products, focused on preventing and combating diseases as well as increasing yields,” according to a Permira press release. The company also provides a range of services and technical assistance to aqaculture farmers throughout Asia, including pond maintenance, water treatment, and soil and disease testing.
The transaction is expected to close in December 2018, and once that happens, Grobest will be housed under a joint venture that will be the firm’s sole corporate shareholder. Permira will own 50 percent of the JV, with a shareholder group led by Grobest CEO Ko Chi-kang and Chairman Chen Chun-ping retaining a 50 percent stake.
Terms of the deal were not announced, but Finance Asia valued Grobest at USD 1 billion (EUR 887 million) in August.
“We are delighted to partner with Permira as we pursue our plans for further growth in the region and expansion into new markets,” Ko said in the release. “Permira’s expertise in backing businesses to become global leaders will help accelerate the next stage of Grobest’s development, after more than four decades of innovation and success.”
Permira was attracted to Grobest “based on its strong technical capabilities and R&D leadership across warm-water species, wide regional presence, and its vision for expanding the business further across Asia and globally,” Permira Nordic Head Ola Nordquist said.
“We are very pleased to partner with the pioneering team at Grobest, a real R&D leader in advanced aquatic functional feed and health products in Asia, and work closely with them to unlock the company’s full potential on the global journey ahead,” Nordquist said. “Farmed fish and shrimp are some of the most efficient and fastest-growing sources of protein for a growing population. The global aquaculture market is still in its infancy, and feed and health products are critical components and an attractive part of the value chain to build a sustainable industry. The value of the global aquaculture market is estimated to be approximately USD 175 billion [EUR 155 billion] and Asia makes up around 90 percent of the aquaculture volume globally and is one of the most rapidly growing regions. We see significant potential for Grobest to continue to grow and support the aquaculture industry with innovative products, both in Asia and around the world.”
Permira’s investment in Grobest continues its focus on the food value-chain and specifically on aquaculture, following investments in aquatic health company Pharmaq animal feed firm Provimi.
“Grobest is a true innovator in aquaculture that started with the vision to build a sustainable aquaculture industry in Taiwan over 40 years ago,” Permira China Head Jim Tsao said. “Under the leadership of the founding families, the company has built an impressive position across the most important markets in Asia. The Grobest story is a real testament on how to build successful international companies from Taiwan. Permira is very excited to be part of the next chapter of Grobest’s story and support the further internationalization of the company.”
Photo courtesy of IndiaMart
