December 26, 2013

CO2 Group acquires Seafarm Pty Ltd for US$10 million

CO2 Group Limited (CO2) has acquired Queensland-based Seafarm Pty Ltd (Seafarm), the oldest and largest fully-integrated prawn aquaculture business in Australia for AUD11.2 million (US$9.9 million).

CO2's wholly-owned subsidiary, Western Australian Resources Limited (WARL) has executed agreements to acquire the business and business assets of Seafarm, which produces prawn under the Crystal Bay^® brand sold widely throughout Australia in supermarkets and seafood outlets.

The acquisition of Seafarm establishes WARL in the marine protein production industry. The completion of the agreement makes WARL one of the largest aquaculture prawn producers in Australia.

The purchase is expected to be earnings positive this financial year and will grow in coming years as WARL introduces advanced production procedures and converts operation to also produce black tiger prawn (Penaeus monodon).

The Seafarm business platform provides the opportunity for production expansion and a pathway via increased tonnage to export markets.

The acquisition is conditional on satisfaction of relevant regulatory consent and approval. The consideration comprises AUD7 million (US$6.2 million) payable on completion and two further payments of approximately AUD2.1 million (US$1.8 million) each in 2015 and 2016.

CO2 Group says the acquisition of Seafarm is another important milestone in WARL's business plans to develop major aquaculture business platforms in Australia, and follows the recent purchase of Marine Farms in Exmouth.

The WARL Sea Dragon Project is the first of a series of  10 large-scale projects of aquaculture production system on land in northern Australia. Each of these projects will result in the capacity to produce 100,000 tonnes of black tiger prawn per year to meet a growing international demand for high quality seafood.