September 10, 2007
New Zealand King Salmon buys into company extracting omega-3 from fish
Hoping to generate cash from what it is now selling off cheap, New Zealand King Salmon (NZKS) is investing into a Malaysian company that is extracting omega-3 oils from the fish it supplies.
NZKS paid about US$2 million for a 26 per cent share in Cambrian and will increase its share to 36 per cent during the next 18 months.
NZKS chief executive Paul Steere said the company had spent about two years working with Cambrian to develop the extraction process.
Cambrian believed it could generate US$8 million in annual sales from the omega-3 extracted from NZKS's salmon by-products, which is currently a low-value products.
Steere said the value of the by-product increased 30 times if it could be sold as omega-3 capsules.
Although Cambrian was still capable of extracting omega-3, NZKS said it would not be able to supply enough fish for the company.
NZKS, which is owned by Malaysian family group Oregon Group, employs more than 400 people throughout New Zealand including 14 at its primary hatchery.
The company has four salmon farms in the Marlborough Sounds and a fifth is about to begin operating in the next few months.
The investment is expected to increase the company's US$75 million annual turnover.
Cambrian will extract the omega-3 oils, put them into capsules and sell them under the NZKS banner initially throughout Asia and then to Australasia, North America and Japan.