BEIJING — June 3, 2013 — Some of China’s largest seafood processing firms are seeking to raise cash this summer, among them loss-making shrimp specialist Zhanjiang Guolian Aquatic Co Ltd which plans to sell 8.8 million shares at CNY 6 (USD 0.98, EUR 0.75) a share. Justifying its cash quest, the firm has pointed to the positives of the bird flu outbreak that has resulted in prawn prices increasing 50 percent in the first quarter on the previous quarter.
Guolian has assured investors that its new tilapia subsidiary will turn profitable this year while it expects profits from its feed sales to rise 13 percent year-over-year. Based in the maritime city of Zhanjiang, Guolian claims its overseas orders were up 10 to 15 percent — despite the anti-dumping charges brought by the U.S. shrimp industry against Guolian and other importers. A nod perhaps to the EU market, the firm made much recently of supplying shrimp for the five-star dinner enjoyed by visiting French president Francois Hollande in Shanghai.
Guolian and other seafood firms in China are also hoping to benefit from renewed interest among venture capital firms in China’s food industry, given rising demand among a growing middle class for quality, safe food products. A breeder and vendor of prawn, tilapia fry, aquafeed and processed products, Guolian counts the United States as a major market but has also recently boosted its logistics and marketing efforts in mainland China.
Key Guolian investors include venture capital firm iD Tech Ventures (a unit of the Taiwan-based Acer IT and technology group) that invested CNY 10 million (USD 1.63 million, EUR 1.26 million) in 2007. Agriculture and food have been key targets for venture capital firms in China in recent years — tech firm Legend Holdings (which owns PC brand Lenovo) recently launched the agri-focused venture capital Joyvio Group outfit with CNY 1 billion (USD 163 million, EUR 125.7 million) in purchases of fruit and food processors in China and abroad. However, venture capital investors have also been put off investing in smaller private Chinese firms due to an embargo on stock listings enforced by government in the past year.
Read the full story at Seafood Source