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Frescatto Company, in partnership with Prime Seafood, has announced their ambitious growth plans following their merger. With an anticipated 25 percent increase in volume to 40,000 metric tons (MT) and projected sales of BRL 2 billion (USD 399 million, EUR 367 million) in 2024 and BRL 3 billion (USD 600 million, EUR 551 million) in 2025, the company aims to become the largest seafood enterprise in Latin America, as stated by Frescatto CEO Thiago De Luca.
According to De Luca, the growth strategy revolves around expanding into new markets rather than focusing solely on cost savings. The merger, characterized by complementarity and synergy, involved a share exchange between Rio de Janeiro-based Frescatto and Recife-based Prime, with no cash transactions. The consolidated entity will operate under the Frescatto brand.
Frescatto, known for its specialization in Chilean salmon, tilapia, and vannamei shrimp, achieved revenues of BRL 1.3 billion (USD 260 million, EUR 239 million) in 2023. De Luca highlighted their intention to leverage Prime's operations in Brazil's north and northeast regions to enhance domestic sales and ramp up exports.
Following the acquisition, Prime's CEO, Eduardo Lobo, will transition to an executive role within Frescatto's leadership, bringing his expertise to the company's board of directors. Frescatto is poised to capitalize on Prime's supplier network and production facilities in Bahia, Pernambuco, and Pará, aiming for a 20 percent increase in supplier base.
Additionally, Frescatto is investing in the expansion of its processing facility in Rio de Janeiro and distribution centers across São Paulo, Brasília, Contagem, and Recife. De Luca expressed interest in further acquisitions and is contemplating an initial public offering to expedite the vertical integration of the segment.
The collaborative efforts of Frescatto and Prime extend beyond business, as both entities, led by De Luca and Lobo, have been actively promoting Brazil's seafood sector through initiatives like ABIPESCA. Discussions are underway to address regulatory concerns, particularly regarding food safety standards, and to lift the ban imposed by the European Union on Brazilian seafood products in 2018.
With a focus on fostering seafood consumption domestically, De Luca emphasized the untapped potential of Brazil's market, highlighting the importance of introducing quality seafood to children's diets at affordable prices. He remains optimistic about overcoming existing challenges and propelling the industry towards sustainable growth.
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