Monday, April 22, 2024

Independent Fisheries deal puts Sealord in top spot

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Agreement to buy the deep-sea fishing company described as “the largest financial transaction in the seafood sector” since 1992.
Sealord was the “logical buyer” of Independent Fisheries, says Port Nicholson Fisheries director Tom McClurg.
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Sealord has crowned itself New Zealand’s lord of the sea with the acquisition of Independent Fisheries.

The fisheries company has announced it will become the country’s biggest seafood business through the agreement to buy privately owned Independent Fisheries, one of NZ’s largest deep-sea fishing companies. 

Sealord won’t comment on how much the deal cost but described it as “the largest financial transaction in the seafood sector” since the Sealord deal in 1992, part of the Māori Treaty Settlement and which NZ First’s Shane Jones described to BusinessDesk as the “jewel in the crown”.

Jones was part of the Treaty of Waitangi Fisheries Commission and also chair of Sealord in the early 2000s. He said it was one thing to amass quota and another thing to consistently generate earnings from it.

“That’s something I think that not only the owners will be conscious of, but it’s a great challenge for the managers.”

“It’s really important to note that Māoridom is increasing its footprint across commercial fisheries,” Jones said.

He pointed to the long-term lease between Moana and Sanford and Aotearoa Fisheries having a 50% ownership of Sealord, alongside Japanese fishing giant Nissui, which owns the remaining 50%.

Jones said, presumably, the leases give both parties better access to a broader base of fishing quota that enables them to expand throughput and expand revenue.

“But all of these things require confidence that the earnings justify the risk.”

Terra Moana partner Tony Craig said quota management systems aren’t like factories – once a quota system is brought in, “you’re then stuck with a volume production that you can’t naturally increase”.

Quota management systems are good for the fisheries, he said, as it means they are managed better, but there is a social consequence through the loss of small-scale owner-operator fishermen.

“That’s what this is all about, really. It’s making sure those companies can remain profitable by doing what they’ve always done because they can’t diversify,” Craig said.

“They’re not like sheep farmers who can decide to go dairy farming if there’s no money in sheep.”

Port Nicholson Fisheries director Tom McClurg said Sealord is the “logical buyer” of Independent Fisheries.

“They’re engaged in very similar fisheries, so I think it’s a good fit with Sealord,” he said.

Where implications lie for the sector, however, is how the fisheries sector gets around arising fleet renewal issues. 

McClurg said Independent Fisheries is “very reliant” on Ukrainian charter vessels to catch its quota.

“It’s a piece in a bigger puzzle because all of the deepwater fishing companies in New Zealand have an issue with fleet renewal and how you finance those kinds of vessels.

“In some ways, bringing Independent Fisheries and Sealord together is a step towards that big picture view of what vessels we really need in New Zealand, owned by New Zealand, to catch our deep-water fish.”

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