New York-based AMERRA Capital, owner of Andromeda Group, the third largest aquaculture company in Greece, has partnered with the Abu Dhabi-based $130 billion sovereign wealth fund Mubadala Investment Company to acquire Nireus SA and Selonda SA – two Greek sea bass and sea bream fish farming companies.
Financial parameters of the deal were not divulged, and the deal remains subject to approval over merger controls and other standard conditions, however difficulties are not expected and the deal is expected to close in the next six months.
AMERRA Capital Management acquired Greece’s Andromeda Group, one of the largest producers of sea bass and sea bream in the country, and the fastest growing group of companies in the Mediterranean aquaculture industry, in the spring of 2016.
Andromeda is a vertically integrated operation engaged in fry production, fish farming, and value-added processing, and is the only company of its kind with production in both the Western and Eastern Mediterranean. It has a global scope of exports and sales, selling its products across Europe, the U.S., and the Middle East.
Global Goals
This deal reflects deeper strategic goals for the companies involved. Mubadala decided last year to strengthen its presence in the global aquaculture sector – an industry it has targeted as being key to the global economy.
“Mubadala took the decision last year to build its presence in the agribusiness sector, which is strategically important to the global economy and has significant potential for value capture,” said Elham Al Qasim, agribusiness director for Mubadala Investment Company. “Aquaculture is one of the most promising sub-sectors, where the deployment of new technologies can drive productivity improvements and accelerate growth.”
And Greece is a good place to start.
Greece’s aquaculture industry is largely focused on the farming of the European sea bass and the gilthead sea bream, with combined production of the two species of approximately 110,000 tons in 2015 according to the Food and Agriculture Organization (FAO). After a series of difficulties resulting from an imbalance between supply and demand, restructuring in the Greek sector including advancements in research, development and innovations to optimize production; diversification of products, and the development of new producers’ organizations have been undertaken with the target of doubling production by 2030.
The Mediterranean accounts for 11 percent of the 2.5 million tons of seafood produced in Europe per year, and it has been one of the fastest growing segments in Europe, showing an average annual growth of 8 percent over the past 10 years according to Huffington Post, and indicating a great potential for future growth.
“With our focus on aquaculture and agriculture investments, we are excited by the synergies that can be created between these companies. We believe that significant value can be created by building on the comparative advantages of the Mediterranean aquaculture sector,” said Thor Talseth of AMERRA.
Together, AMERRA, Andromeda, and Mubadala plan to use this deal as the foundation to form a new company called Andromeda Seafood, a source told Undercurrent News, who added that an initial public offering should follow.
“Our goal is to form a new multinational company that will play a leading role internationally in the aquaculture sector,” said Dimitris Valachis, group CEO, Andromeda Group. “We will join forces and share knowledge, expertise and human resources to create a global aquaculture company that will boost the growth of the Greek fish farming industry.”
-Lynda Kiernan