COMPANY COMMENT
Brimstone scales up Sea Harvest investment
The empowerment group has been cautious on the deal-making front in recent years
Although it’s been disclosed before, empowerment group Brimstone’s decision to help fund fishing subsidiary Sea Harvest's bid to broaden its profit catch is an important development. Brimstone has been cautious on the deal-making front in recent years, not willing to overpay for assets that have been enticingly dangled. So pumping R300m into Sea Harvest in a share-subscription agreement at R14/share is a weighty decision for Brimstone. Essentially, the proceeds will part-fund the recent acquisition of the Ladismith Cheese Company (LCC), a deal that market watchers still appear divided over. Clearly Brimstone believe LCC’s dairy niches are attractive over the longer term, and – more importantly – will offer Sea Harvest a profitable platform on which to build other non-seafood brands. Gut feel is that Sea Harvest will not look for sweeping commodity plays in the food sector. So instead of pursuing opportunities in sectors such as poultry the company is expected to rather gather a bask...
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