The family business De Costi Seafoods has been sold to the big Atlantic salmon farm group Tassal for an upfront $50 million in cash and further payments depending on meeting targets.
De Costi was established at the Sydney Fish Markets in Pyrmont in 1981, becoming one of the most recognisable seafood brands in Australia.
George Costi, a director of De Costi Seafoods, will stay with the company for at least the next three years. The De Costi Seafoods group posted a profit of $2.8 million in 2014.
Allan McCallum, Tassal’s chairman, says there’s a compelling strategic rationale for Tassal’s acquisition.
“The De Costi Seafoods business is one of the largest in Australia’s seafood industry,” he says. “It has access to the best seafood range, a strong capability to process a wide variety of seafood, market leading seafood expertise, and a central location that enables it to service retailers down the East Coast of Australia and South Australia.”
The acquisition is part of Tassal’s plans to to grow its share in Australia’s $4.3 billion seafood market.
Last year Tassal completed a $200 million, five-year investment program covering its hatching, growing and processing infrastructure in Tasmania, allowing the company to grow domestic sales and remove a reliance on exports.
Tassal posted a 34.8% increase in net profit to $30.3 million for the first half.
Its shares were up 6.9% to $3.56.
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