Sign up Australia
Proactive Investors - Run By Investors For Investors

Benchmark Holdings pays US$16.25mln for 49% stake in Chilean joint venture

The JV establishes a platform for Benchmark to develop a leading position in breeding and genetics in the world's second largest Atlantic salmon production market;
Salmon
The deal accelerates Benchmark's growth strategy in Chile

Benchmark Holdings PLC (LON:BMK) is to fund a Chilean breeding and genetics joint venture with Empresas AquaChile.

The aquaculture health, advanced nutrition, and genetics business is paying US$16.25mln for a 49% stake in the joint venture (JV).

READ: Benchmark’s new sea bass vaccine dive into field trials

The company will fund the acquisition with a placing of new shares to raise £19mln, some of which will go towards a US$5.4mln (£4mln) loan to the JV and covering transaction expenses.

Chile is the world’s second-largest salmon market and the deal will increase Benchmark’s currently limited presence in the market.

Sythomer said it expects the acquisition will immediately enhance earnings. In the fourth months to September 2018 – the end of Benchmark’s financial year – the company expects the JV to make a contribution of £1.81mln to adjusted underlying earnings (Ebitda) while in the 12 months following that it is projected an adjusted Ebitda contribution of around £2.4mln.

Benchmark, which is set to declare half-year results on June 19, said it is on track to meet its expectations for the full-year following strong first half performances in a number of key areas.

"Combining AquaChile's existing high-quality land-based production and locally adapted genetics, with Benchmark's breeding and genetics capabilities and IP [intellectual property], we believe, will create a world-class operation. The flexibility to use our facilities in Iceland to support the JV gives us a strong competitive advantage in the market,” said Malcolm Pye, the chief executive officer of Benchmark.

"Following a good first half performance, we are on track to meet our expectations for the current financial year. The continued growing global demand for aquaculture products, combined with the disease challenges faced by the industry, puts us in a strong position to drive attractive growth and returns in the years to come," he added.   

View full BMK profile View Profile

Benchmark Holdings PLC Timeline

No investment advice

The information on this Site is of a general nature only. It does not take your specific needs or circumstances into consideration, so you should look at your own financial position, objectives and requirements and seek financial advice before making any financial decisions. You acknowledge and understand that neither the Company, its related bodies corporate, the information providers or their affiliates will advise you personally about the nature, potential value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter. You should read our FSG and any other relevant disclosure documents and if necessary seek persona advice prior to making any investment decision.

You understand and agree that no Content (as defined below) published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person.

You understand that in certain circumstances the Company, its related bodies corporate, the information providers or their affiliates may have received, or be entitled to receive, financial or other consideration in connection with promoting, and providing information about, certain entities on the Site and in communications otherwise provided to you.

You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate. From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

Before you act on any general advice we provide, please consider whether it is appropriate for your personal circumstances.

© Proactive Investors 2018

Proactive Investors Australia PTY LTD ACN:132787654 ABN:19132787654.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use