BENCHMARK is raising around £30.7 million by placing shares with the aim of investing in three new aquaculture projects.
These include a joint venture with Salten Stamfisk AS to build a new combined land and sea based production unit in Norway that will produce a year-round supply of salmon eggs from biosecure facilities.
This is expected to open up new market opportunities for biosecure ova and meet demand growth which has been driven by the success of Benchmark’s genetics and overall industry production growth.
The new plant is expected to have a yearly production capacity of 150 million ova, representing an increase of approximately 37.5 per cent on Benchmark’s current capacity.
The total capital expenditure budget is £32.3 million and the joint venture is finalising bank debt to fund 60 per cent of this.
Benchmark is intending to invest up to £15.5 million in the joint venture in return for a majority shareholding of up to 89 per cent. Requests for tender have been issued to contractors and construction is expected to commence in autumn 2016.
The group is also embarking on a joint venture with a major salmon producer to provide outsourced breeding and genetics services.
Benchmark is intending to invest up to £2.2 million in this project as well as associated costs, in return for 50 per cent of the equity. A letter of intent has been signed and contracts are in discussion with the intention to commence activities before December 31, 2016.
The third venture involves the acquisition of specialist breeding and genetics assets and intellectual property in the shrimp sector that will provide a market entry in a new aquaculture species for Benchmark.
The target business has an established genetics programme and broodstock, together with a highly regarded genetics team based in Latin America.
Its specified pathogen resistant (SPR) products are designed to alleviate industry losses due to disease. Benchmark’s projected investment is £3.5 million.
Malcolm Pye, chief executive Officer of Benchmark, said: ‘The funds raised will allow us to continue to execute our strategy of making value enhancing selective acquisitions, and allow Benchmark to invest in some important strategic joint ventures to deliver significant synergies and sales growth.’