US trout farmer Riverence closes deal for larger rival Clear Springs

The second-largest rainbow trout farmer in the US, owned by the creator of a multitude of hit TV shows, has a deal for its larger rival, Clear Springs Foods, making it, by far it the largest farmer of the species in the country.

The purchase by Riverence Holdings, the parent company of Idaho’s Riverence Farms, means that the combined vertically integrated farmer will include 14 farms with a total capacity of 15,000 metric tons annually, four brood stations, two processing facilities, a value-added processing arm, waste recovery plant and a feed mill, the company said.

The terms of the deal were not disclosed. The firm Antarctica Advisors represented Clear Springs on the transaction.

Both trout farmers are located in Idaho’s Magic Valley, the US’ major center for trout farming.

“We believe in aquaculture and sustainable, land-based production of seafood,” Rob Young, CEO of Riverence said in the release. “With this investment, we are deepening our commitment to doing what’s right in support of our communities, the fish we produce, and the natural resources we share. Together, we stand ready to redefine farm-raised  sh and the future of American aquaculture.”

Riverence is owned by David E. Kelley, the creator of hit TV shows such as Big Little Lies, L.A. Law, Picket Fences, Chicago Hope, Ally McBeal, and Boston Legal.

The sale is thought to offer a big pay-day for the employees of Clear Springs, founded in 1966. However, trout farming in that part of Idaho began in the 1920s using water sourced from the Snake River aquifer. The city of Buhl describes itself as “the trout capital of America” and is also home to Evaqua and Rangen, a maker of aquaculture and animal feeds.

In July, Undercurrent News revealed that Clear Springs had sold a value-added plant to Spring Salmon, exiting the value-added production of breaded trout as well as species such as cod, barramundi, and haddock.

Also at that time, Kurt Myers left the CEO spot at Clear Springs, after a year in the role. He was replaced by Jeffery Jermunson, a long-time executive of the company and its former chief operating officer.

From Hollywood to trout farming

Until an Oct. 16, 2019, presentation at Long Beach, California’s Aquarium of the Pacific, Kelley’s involvement in steelhead farming wasn’t widely known. But he told the audience at the aquarium that he fell in love with aquaculture after fishing for salmon in British Columbia, and was motivated to get into the business.

“I’ve often thought, as the salmon go, so do we. That’s how I got into it,” he said.

Riverence purchased a Rochester, Washington, hatchery in 2013, a business that supplies trout and salmon eggs to farmers across the US and around the world, with customers in Peru, Japan and elsewhere.

And a few years after overhauling and investing in that hatchery, Riverence began looking further down the supply chain and purchased the assets of trout farmer Seapac of Idaho, now Evaqua.

Riverence’s improvements to the Idaho farms included connecting records between the hatchery and the farms to prove traceability and developing an in-house software platform that integrates genetic information into its operations.

But Kelley told the audience that while he’s happy with the quality of the fish, Riverence is producing, it needs to expand its markets.

“Our biggest challenge at this point is still building our market. Because we have invested in nutrition, we’ve lowered densities, we’ve put a lot of effort into making our fish a premium fish and now the goal will be to command a premium price,” he said.

Echoing a complaint among many seafood suppliers, Kelley said that while consumers often state a desire for additional sustainability, they aren’t always willing to pay a premium for it.

Kelley said that his desire to farm  sh is motivated firmly by a desire to mitigate the effects of climate change — by convincing consumers to eat  sh which, compared with beef and chicken, have lower feed conversion ratios. But Riverence, which is close to profitability, he said, has to turn a profit.

“I could say that this is a philanthropic endeavor and maybe to a large extent it is because I’m trying to protect and save something that’s larger than myself, but the reality is that we’re in this for a profit. And that is important because the only way that aquaculture is going to grow — and it has to grow — is if we establish proof of concept that you can make money doing so.”

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