Sea Harvest packs for Perth

Sea Harvest CEO Felix Ratheb,

CAPE TOWN’s iconic hake company Sea Harvest has surprised the old salts in the fishing industry by casting deep into international waters. In early January Sea Harvest – which has a large production plant based in Saldanha Bay – announced a 19,9% investment in Mareterram Limited, a specialist fishing company-based in Perth and (recently) listed on the Australian Stock Exchange. The move was largely unexpected with Brimstone, the controlling shareholder on Sea Harvest, seemingly intent on pursuing organic growth by building additional non-seafood frozen food ranges.

Mareterram is a vertically integrated agri-business with operations that span wild caught king and tiger prawns as well as scallops and a seafood distribution business (that has long distributed Sea Harvest’s brands in Australia.)

Sea Harvest CEO Felix Ratheb said the investment in Mareterram allowed the company to diversify its earnings away from a single specie hake resource.

“It gives us a firm foothold to increase our market share and presence in Australia in a hard currency.”

Sea Harvest chairman Fred Robertson noted that Mareterram strategy was very much aligned to that of Sea Harvest.

“It is centered on using a platform of wild caught, MSC (Marine Stewardship Council) certified seafood to build a broader-based food business.”

Mareterram comprises two main segments, Nor-West and the Craig Mostyn Group (CMG,) which combine into a fairly substantial operation.

Norwest is mainly a prawn fishing company with revenues of AU$14m (R160m.) It also fishes for scallops, crabs, scuttlefish and squid.

CMG distributes frozen seafood, potato products and a range of convenience foods to food service and retail customers in Australia. The company’s turnover in the 2015 financial year was AU$34m – equating to around R360m. This should add a chunky rand hedge element to Sea Harvest’s seafood basket.

Sea Harvest ranks as one of the largest vertically integrated fishing companies in South Africa with operating profits increasing 35% to close to R90m in its last financial year. The company owns 12 deep-sea fishing trawlers, and is regarded as is the leading brand in the South African frozen fish segment with over 40% volume share.

Last year Sea Harvest reported sales volumes increasing 6% on the back of strong growth in export markets.

Aside from an existing presence in Australia, Sea Harvest also has a presence in the US and European markets.

It should be fascinating to see if Sea Harvest – encouraged by Brimstone – opt to pursue a bigger stake in Mareterram in the years ahead, or if there are further deals that Sea Harvest can land – locally and abroad – to diversify the seafood base further.

Last year Oceana – a diversified fishing company in which Brimstone is an empowerment partner – made its first big splash in international waters when it acquired Louisiana-based fishmeal and fish oil specialist Daybrook Fisheries.