October 11, 2011
Guangdong Evergreen Co, a Chinese aqua feed producer and aquatic farm, has received an investment capital of more than RMB100 million (US$16 million) from a Legend Capital-led consortium.
Guangdong Evergreen Co is a core member company of Evergreen Group, a private-owned company engaged in aquatic breeding, aqua feed production and aquatic medicine production.
With a breakthrough in trans-regional expansion, Evergreen Group has built aquatic farms in Guangzhou, Hainan, Zhejiang and Jiangsu. It is believed that there is great growth space for it in Central China's Hunan and Hubei. This sharpens its competitive edge while most aquatic farms are hard to achieve scale development due to water restriction.
Legend Capital will provide a wide range of value-added services for Guangdong Evergreen Co, involving finance, corporate governance and law consultancy service, said Liu Zehui, managing director of Legend Capital.
The company paid close attention to modern agriculture in recent years and has invested in several agribusinesses including Lihua Livestock and Poultry Co.
Unlike other livestock feeds, there is less competition in aqua feed sector, which enjoys relatively high profit margin and growth potential. The Chinese now prefer low-fat foods like fish and shrimp rather than high-fat pork, beef, mutton and chicken on health concern.
This drives the consumption of aquatic products and spurs the expansion of aquatic farms. Demands for aqua feed are rising sharply. The domestic feed industry expanded at a double-digit pace in recent years, with shrimp feed advancing at a faster pace, said Liu.
Evergreen Group has been engaged in the R&D and production of shrimp feed since its inception in 1998 and has grown into the biggest. It now has over 10 member companies focusing on production and sale of shrimp feed. With a full business line covering production of shrimp feed, aquatic breeding and production of aquatic medicine, Evergreen Group appears more competitive than the counterparts.
It now has no plan to go public, although the current listed feed producers receive warm response from investors.