Melbourne-based circular economy company Close The Loop (ASX: CLG) has this week acquired fast-growing seafood packaging group Oceanic Agencies for $3.25 million.
Close The Loop, which debuted on the ASX last week following a $12 million IPO, says the deal strengthens its bulk and commercial seafood packaging capability in a growing and “highly complementary” sector to its existing seafood business offering.
For $3.25 million, of which $2.5 million is payable at settlement, Close The Loop will acquire 100 per cent of Oceanic Agencies - a Queensland-based business providing both packaging and materials handling for the aquaculture, wild caught and post-harvest sectors of the seafood industry.
Oceanic supplies more than 600 Australian seafood companies with custom-printed commercial packaging, insulated bins, flexible plastic packaging and plastic tubs and creates.
The Sunshine Coast-based company generated revenue of $5.2 million in FY21 and a net profit of $764,000.
Close The Loop says the acquisition marks its expansion in the growing commercial and bulk seafood packaging industry, and delivers on its strategy to grow within the niche packaging and recycling space.
“We are delighted to have acquired Oceanic Agencies – a company at the forefront of new and innovative sustainable packaging and material handling products for the Australian seafood industry,” Close The Loop CEO Joe Foster said.
“The acquisition delivers on our strategy of further growth within the niche packaging and recycling space and provides further diversification of our circular economy solution.
“We will combine Oceanic Agencies’ leading position in seafood packaging and growing customer base with our leadership in the global circular economy for packaging to further enhance our packaging and recycling offering across Australia and worldwide.”
The deal comes less than a week after Close The Loop landed on the ASX with a market capitalisation of $65.9 million at the IPO price.
It represented a milestone for Close The Loop - a resource collection and recycling company founded in 2001 with a mission to divert products away from landfill and see them recycled instead.
In FY21 Close the Loop Group reported revenue of $67.4 million and forecasts revenue to grow to $73.9 million in FY22.
“We are delighted with the outcome of the IPO and the strong support shown by our new institutional and sophisticated investors,” Close The Loop chairman Greg Toll said last week.
“Our listing today on the ASX marks not just an important milestone for Close the Loop as we progress our next phase of growth, but the Company has become the first end-to-end ‘circular economy’ business to list in Australia.”
In the week since listing the company’s share price has risen from its IPO price of $0.20 per share to $0.32 per share at the time of writing.
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