Sheffield’s Benchmark Holdings enhances aquaculture expertise with two major acquisitions

Sheffield’s Benchmark Holdings PLC, the aquaculture breeding, animal health, technical publishing and sustainability science business, has just boosted its expertise in key sectors of the industry after securing two major acquisitions.

The company has acquired the entire issued share capital of Norwegian aquaculture genetics and research business Akvaforsk Genetics Center AS (AFGC) and 80% of the issued share capital of Akvaforsk Genetics Center Inc. (Spring Genetics), a US-based tilapia genetics and breeding business for a combined initial consideration of approximately £11m, satisfied from existing cash balances.

The acquisitions, which have expanded on Benchmark’s position as the second largest global firm in salmon breeding and genetics, are part of a strategic move into aquaculture genetics across a wider number of the major farmed species, and into breeding in the fast growing tilapia sector.

As well as maintaining a strong performance in its Breeding and Genetics Division, Benchmark has successfully recovered its sales of Byelice/Salmosan in Chile as announced in the Interim results.

What the Acquisitions mean:

• These acquisitions are expected to be earnings accretive (before amortisation of acquired intangibles) in the year ending September 30th, 2016.
• They will also enhance Benchmark’s position as a leader in the aquaculture genetics space, with new customers across new geographies and species.
• Create multiple opportunities for immediate synergies across the Benchmark Group

AFGC is a provider of technical genetic services, with long term customer contracts across many aquaculture species in Norway, Canada, Thailand, China and the USA. These include Marine Harvest (salmon), Nireus (sea bream and sea bass), Hainan Progift Aqua-Tech and Manit Farm (tilapia), Stolt Sea Farm (turbot) and SalmoBreed1 (salmon).

Spring Genetics, based in Miami and Mazatlan, Mexico, has built a strong brand as one of the few independent tilapia primary breeding companies. Spring Genetics is predominantly focussed on the USA and Latin America where it has multiplier and hatchery customers in Brazil, Mexico, Guatemala, Belize and El Salvador.

The acquisitions is a major step towards building the platform from which Benchmark will provide sustainable food chain solutions which integrate the key components of animal health; genetics, animal husbandry, health products and nutrition.

Benchmark has identified revenue and operational synergies between the acquisitions and the Benchmark Group, including the existing genetics businesses, SalmoBreed and Stofnfiskur, which were acquired in December 2014. AFGC and Spring Genetics will join these companies as subsidiaries of Benchmark’s Breeding & Genetics division.

Malcolm Pye, Benchmark chief executive, said: “This deal is an opportunity for Benchmark to further advance its position in the aquaculture genetics and breeding sector. The acquisitions bolster our recognised status in the salmon genetics space, and moves Benchmark into the rapidly growing tilapia market.

“The acquisitions of AFGC and Spring Genetics give Benchmark access to new geographies and customers in emerging markets, diversify our offering and fulfil Benchmark’s strategic objective of offering our expertise across a range of species within the aquaculture arena. The entrance of the Company into the tilapia market is particularly encouraging, as it is one of the fastest growing sources of protein in the Latin American region.

“This is a very exciting time for the Company, with Benchmark’s Breeding & Genetics division going from strength to strength over the past year. We are now positioned as one of the leading global players in the aquaculture genetics sector, and we look forward to further growing this division of the business.”