Mark Ryan, Tassal CEO. (Photo: Tassal Vimeo)
AUSTRALIAFriday, February 13, 2015, 00:40 (GMT + 9)
Major salmon producer Tassal confirmed that it is holding talks to purchase New South Wales (NSW)-based fresh food business De Costi.
De Costi was established in Sydney Fish Market in 1981, and operates retail and wholesale throughout the state of NSW.
The Tasmanian company, regarded as the biggest local salmon producer, intends to widen its seafood offer currently limited because of market distance and fish shelf life.
The negotiations started are in line with the goal of achieving strategic expansion and reducing operating costs.
"In the harbour [of Sydney] - you're going to get better quality product coming out that's going to be fresher, handled in a food safe environment," Tassal CEO, Mark Ryan, explained
The news of the possible deal started when Tassal reported a 12.3 per cent rise in revenue for the six months ended 31 December to AUD 151 million, and a 34.8 per cent increase in its net profit to AUD 30.3 million.
Tassal has also managed to reduce its net debt by nearly 3 per cent.
Ryan related the company's recent growth with its environmental credentials, which contributed to maintain prices in a volatile market, AAP informed.
The executive pointed out that while the seafood industry in Australia tends to be unsophisticated, with a fragmented number of suppliers, processors and sellers, who make costs and losses become higher, De Costi has the knowledge and experience to address these inefficiencies.
The salmon processor has invested nearly AUD 14.5 million in growing fish biomass to boost long-term returns and made strong profits due to feed conversion, fish survival rates and growing conditions, offsetting the reduced sizes of fish in the hot 2012-13 summer.