Fujian Provincial Pingtan County Ocean Fishing Group Co Ltd, part of Pingtan Marine Enterprise Ltd, has entered into a RMB400m (US$64m) investment agreement with China Agriculture Industry Development Fund Co Ltd, with the latter acquiring a 8% equity interest in the company’s operations.
The company intends to use the proceeds from this strategic investment for the acquisition of additional vessels and to build a fish processing plant in order to execute on its strategy to expand downstream by selling fish products directly to end markets.
Xinrong Zhuo, chairman and CEO, Pingtan, said: “We are pleased to welcome China Agriculture as our shareholder as it truly reflects Pingtan's strength and value within the industry. We feel that this strategic investment was made at an attractive valuation for our fishing business, while also providing our company with the funding to expand our operations and strengthen our capital structure."
He pointed out that this will include the expansion and renewal of the company’s fleet and also allow it to work more towards its goal of becoming a vertically integrated seafood provider.
Upon the closing and funding of this strategic investment, Pingtan will own 92% of its lone subsidiary with the company’s current VIE structure being terminated.
China Agriculture was established by China's Ministry of Finance, Agricultural Development Bank of China, Cinda Asset Management Corporation and CITIC Group in 2012. China Agriculture is the first China state-owned fund to focus on investing in all areas of the agriculture industry.
