Cargill agreed to pay €1.35 billion for Norwegian salmon-feed supplier EWOS AS in a deal Rabobank International says will make the world’s largest grain trader one of the top three aqua-feed producers.
The purchase from private-equity firms Altor Equity Partners and Bain Capital Partners is expected to close by the end of the year, the companies said Monday. This is Cargill’s second aquaculture deal since July, when it announced a $30 million venture with Naturisa to build a shrimp-feed facility in Ecuador.
The EWOS acquisition gives Minneapolis-based Cargill an entry into the salmon market as consumption in emerging economies drives global demand higher. Cargill will now be among the three biggest aqua-feed producers and “very close” in size to No. 1 player Skretting AS, according to Gorjan Nikolik, a senior seafood industry analyst for Rabobank International.
"Cargill is in tropical species such as shrimp and tilapia, they are in Asia and they are in Central America,” Nikolik said Monday by phone from Utrecht, the Netherlands. “EWOS is in salmon, a cold-water species farmed in Norway, Chile, Canada and Scotland, so for them it’s a species diversification and a geographical diversification.”
The deal is Cargill’s largest since its 2011 acquisition of animal-feed group Provimi. It is “evidence of the company’s commitment to the growing aquaculture industry,” Cargill Chief Executive Officer David MacLennan said in a statement. Farmed fish and shrimp are one way to meet global demand for protein that’s set to grow by 70 percent by 2050, said Sarena Lin, president of Cargill’s feed and nutrition business.
News by Bloomberg, edited by ESM
