Capital Award, Inc. (“CA”) is a wholly owned subsidiary of Sino Agro Food, Inc. (SIAF). Currently engaged in modern fishery project management and consultancy services, CA provides consulting, engineering, and construction services to fish farms adopting the A Power Recirculating Aquaculture Systems (“APRAS”) technology for the development of fish farms. From 2009 to 2016, CA developed four land-based aquaculture farms which were operated as joint ventures.
In 2011, Capital Award commenced engaging in the marketing and sale of fish and seafood for the joint ventures, which continued until SIAF completed an aquaculture carve-out spin-off (COSO). After ownership of these farms was restructured in late 2016, all the aquafarms were transferred to Tri-way Industries Ltd. (“TW”), a Hong Kong corporation. SIAF retained a 36.6% equity interest in Tri-way who now operates the fish farms and derives revenue from the sale of goods previously reported under CA.
Thus, after the-carve-out transaction, SIAF records recurring income in three ways:
The restructuring transaction is more fully explained here:
The carve-out of aquaculture operations into Tri-way Industries Ltd. is part of a broader carve-out and spinoff (“COSO”) strategy explained here:
APRAS, now beyond its 11th generation, is an engineered, self-contained water treatment and re-circulating aquaculture system for the growing of aquatic animals on a commercial scale. It mainly consists of the A Power Grow Out Basin and the A Power Treatment Stack equipment, and operating techniques and procedures, which Capital Award has established as essential or desirable for the establishment, development, and operation of the A Power Recirculating Aquaculture System.
In an APRAS designed fish growing system; fish produced are free from diseases commonly associated with outdoor aquaculture methods. The system is fully integrated, automated and climate-controlled, and with strict water quality management, the APRAS fish growing system creates a stress-free environment for the fish. These ideal growing conditions enable improved productivity, offer mortality rates of less than 8% and a feed-to-fish conversion ratio of 1:1 for pellet feed and 2:1 for non-pellet feed.
The system is housed on land in an enclosed environment under fully controlled conditions, and by avoiding contact with any outdoor contamination and using treated water; APRAS produces healthy farmed fish guaranteed free of antibiotics and other pollutants.
Our environmentally friendly system recycles all water used in the farm. It enables the consistent year round production and supply of fish in the vicinity of urban areas. Less evolved recirculating aquaculture systems have been commercially applied in Europe and Australia for the past 30 years and earlier versions of the technology have been commercially developed and used in Australia since 1998. However APRAS is relatively new to Asian countries, including China.
Open Dam Recirculating Aquaculture Systems (“ODRAS”)
In addition to indoor tanks employing APRAS technology, CA applies the technology to open dams, ODRAS, often used in conjunction with the indoor tanks. As of the end of Q1 2017, CA has completed 240 MU (16 acres) of third generation ODRAS out of 600 planned MU at aqua farm 4.
Zhongshan Prawn Project: In March of 2014, the Company announced that Capital Award has entered a long term 1,300 Acre Prawn and Hydroponic Venture. CA will provide construction and development, as well as management, supervision, and training.
An FAQ about the “MegaFarm” project is available, as well as a presentation of the project plans in English. A version of the Zhongshan Prawn Project Information Brochure is also available in Chinese: 中山新虾场方.