Benchmark in talks to take over Chile joint venture

Aquaculture health, nutrition and genetics company Benchmark Holdings updated on its joint venture with Chilean breeding and genetics partner AquaChile on Wednesday.

The AIM-traded firm noted that in January, Agrosuper completed the acquisition of AquaChile, and as a result , Benchmark had the opportunity to take control of a salmon breeding operation in Chile currently owned by the joint venture, allowing it to pursue an independent strategy.

It said it was in discussions with AquaChile regarding the dissolution of the joint venture.

The discussions reportedly envisaged a return of the company's original equity investment in the venture, together with Benchmark's intellectual property rights, the genetic stock and biomass, and resources sufficient to operate the 50m egg facility.

It said it expected to reinvest the returned funds in the wholly-owned business in the coming years, to allow it to enhance biosecurity and achieve full scale production at the bio-secure, land based facility.

The board said it expected that the proposed strategy would deliver returns in line with those set out when entering the joint venture.

Benchmark Genetics, under the joint venture with AquaChile, had been successful in accelerating its entry into the Chilean market as a local player with the launch of Benchmark Genetics Chile in October last year, and the successful establishment of its genetics programme locally, which the directors said had created a “strong platform” for growth.

Chile was described as the world's second largest salmon producing country, and an important market in Benchmark's long term strategy.

“We are pleased to have the opportunity to fully own the world class salmon breeding facility currently owned by the joint venture and to reinvest the funds to move towards full scale production and commercialisation,” said Benchmark chief executive officer Malcolm Pye.

“We look forward to strengthening both our relationships and cooperation with existing and new partners in Chile.

“Whilst this marks a change to Benchmark's approach to the market, it is a positive step towards fulfilling our key objective of accelerating our establishment of a strong local presence in this important market, in line with our strategy.”