The world’s their oyster as Roc shells out cash for a new brand
Australia’s Oyster Coast, which is 75 per cent owned by Roc Partners, is launching a new consumer brand as it looks to bolster production and eyes its first export markets.
The nation’s biggest producer of Sydney rock oysters – backed by the $2bn Roc Partners agricultural private equity manager – is launching a new consumer brand as looks to bolster annual production to three million dozen oysters and eyes its first export markets.
Australia’s Oyster Coast (AOC), which is 75 per cent owned by Roc, is launching a multi-species, domestic consumer brand to be known as “Oystersmith” to complement its top shelf, prestige brand “Appellation”.
The new brand is a play on the word blacksmith.
“It is all about curating the oyster for a segment of the market, which is really kind of a second tier to the Appellation brand. It is the next iteration of our story,” AOC chief executive Devin Watson said in an interview in the firm’s Batemans Bay office on the NSW south coast.
“Our company was formed on the basis of creating industry standards, so we want to ensure that every single market is tailored to and looked after by building brands around those marketplaces.”
Roc Partners group managing partner Michael Lukin, who is AOC executive chairman, said the oyster group wanted more innovative branding.
“Before AOC and the Appellation brand, an oyster was an oyster. We have been able to now replicate what you see in the wine industry around different vintages, regions and profiles. The new brand is an extension of that. This moves us into adjacent categories like Pacific and half shell oysters,” he said.
“For the mass affluent looking to access the oyster category, the new brand will take us into that without diminishing the market position for the Appellation brand.”
Roc, which is backed by superannuation funds including the top-performing Qantas Super run by Andrew Spence, recently surpassed $2bn in agricultural assets under management.
Its other investments in food and agriculture include Wagyu beef business Stone Axe, glasshouse producer Flavorite, Lachlan River Almonds and chicken farmer ProTen.
Roc plans to launch its next food and agriculture fund to a global audience later this year.
The private equity group has so far injected $22.6m into AOC, which has been matched by other wealthy investors in the group, led by director and former ASX-listed company board member David Trebeck.
Mr Lukin said despite previous speculation, there were no current plans to consider an ASX listing of AOC.
“Having super money as investors means we can take a longer-term view. We benefit from having patient capital around the table. We are a private company and will remain private for the foreseeable future. At the right time we will look for an exit for the investors but there is nothing imminent,” Mr Lukin said.
“We are now coming into an environment where we can put runs on the board. With the new brand and M&A opportunities, we believe we can grow this into the pre-eminent oyster brand in the country. Selling the business today would be selling it short on its potential,” he said.
Devin Watson, who has been with AOC since 2108 and was previously financial controller at the Consolidated Pastoral Company, said Roc had brought “patience and a level of expertise” to AOC.
“They have also brought – from my perspective – corporate governance, which this industry has been lacking. It is certainly great to have good investment partners that can support you through the thick and thin. They are passionate in terms of the ag space,” he said.
AOC has been through a difficult period of fires and floods that have impacted the NSW south coast, which has put Roc’s strategic plan for the firm back by at least a year. But over the past 12 months AOC has enjoyed a more stable operating environment.
The group is expected to produce a record 1.8 million dozen oysters in the current financial year, up from 650,000 dozen in 2022, and wants to grow that to three million dozen in the next two years.
Turnover is expected to be $25m this year, up from $15m in 2022.
AOC is also benefitting from a 65 per cent increase in farm-gate oyster prices industry-wide over the past 14 months, driven by the supply shortages flowing from the La Nina weather event and the outbreak of QX disease, which has devastated oyster production from Port Stephens on the NSW Mid North Coast.
Mr Watson said AOC was now looking to make its first move into international markets with its Appellation brand of rock oysters.
“Singapore will be the first cab off the rank with the rock oyster. It is another education process. The Pacific oyster is a well known oyster across the world. The rock oyster is less known but it has a deeper and richer taste profile,” he said.
Restaurants will be the initial target market. AOC will be part of an Australian government delegation to Singapore later this year to help lift its brand profile, especially among chefs, ahead of starting exports from Australia.
“There’s a lot of expats in the Singapore and Thailand and even Hong Kong markets. So that makes it easier,” Mr Watson said.
AOC is also looking to increasingly automate operations across its supply chain, which would “reorganise” rather than reduce the workforce.
“We are reimagining how we work right across the business. Whether it is removing the processing burden out of the farms by automating the core equipment which makes the process more efficient, to introducing bulk bins,” he said. “We also have multiple prototypes being trialled throughout the business, whether it is in farming or processing. They won’t take away the labour force but rather help us to re-organise it to allow us to increase production and get the volumes we want. The final stage of cutting and turning an oyster is always going to be done manually.”
The author visited Batemans Bay courtesy of AOC.
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