Australis Seafood continues debating fraud among owners

    Quiroga plans to file a complaint with the China Securities Regulatory Commission alleging that Joyvio provided false information to the market.

    Isidoro Quiroga, the former director of Chile-based Australis Seafoods, has once again raised his voice against the accusations made by Australis’ new owner, Joyvio. However, this time not to defend himself, but took legal action against the accusation of fraud filed by the company’s new ownership group.

    Australis Seafood was sold to Chinese giant Joyvio in 2018 for US$921 million. However, at the end of March 2023, Joyvio announced that it was filing a $1.22 billion lawsuit against Quiroga for damages. These legal actions are in response to infractions related to overproduction at five fattening centers, which Quiroga – according to Joyvio – knew about, but concealed in the transaction.

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    According to El Mercurio, Quiroga has now hired a law firm in China to “pursue and make clear” to the Shenzhen Stock Exchange and investors the facts. Consequently, according to the newspaper, Quiroga plans to file a complaint with the China Securities Regulatory Commission alleging that Joyvio provided false information to the market.

    Prosecutor reading a lawsuit. Photo by Adobe Stock.

    The e-mails that can change everything

    Ricardo Misraji was the company’s manager until June 2022 and Santiago Garretón was its administration and finance manager. Misraji died earlier this year and Garretón was dismissed in September 2022. As reported by La Tercera, Garretón is currently in a labor tutelage complaint concerning an alleged unjustified dismissal, as well as the violation of constitutional rights.

    As part of the ongoing labor lawsuit, Garretón’s lawyer presented a chain of e-mails to the court in which he perceives the difficult relationship between the Chinese and the salmon company’s management.

    Among them, reported La Tercera, was a particularly relevant e-mail from Ricardo Misraji dated March 28, 2022, to Jacob Tang and Qingtong Zhou, CEO and director of Joyvio Foods. In it, he explained the company’s situation in the last period.

    Thus, according to La Tercera, the content of the email explains that the company’s manager felt “personally questioned these days”. And added “I imagine some reasons for that: ASF in the Q4 2021 period did not outperform its peers as in the past. […] The change of government and stricter supervision of the PTs (parameters), despite being out of our control, is a difficult situation, not easy to handle,” described Misraji in response to the Australis president’s criticism of CFO Santiago Garretón’s execution of a cost-cutting plan.

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    Another of the emails that have come out, as reported by El Mostrador, already spoke of overproduction at the beginning of 2022. According to the newspaper, on February 7, 2022, Garretón, among other things, expressly informed Joyvio’s team that, although Australis’ harvest potential was significant, the authorized harvest was lower. The potential was 47 deposits with 117,000 tons per year, but the authorized harvest was only 72,000 tons per year. However, the company went ahead with production.

    Joyvio’s version of Australis

    As reported by El Mostrador, the Chinese company explains that the emails and documents are data out of context and that it comes from events from 2016. Furthermore, they claim that the annex in the sales agreement is misleading and does not tell the truth. The problem comes from the fact that it would be from mid-2021 when they realized that the problem was not isolated, it was systematic.

    The 7th Civil Court of Santiago ordered three executives to personally answer a questionnaire prepared by Quiroga’s legal team in Chile. Thus, Shaopeng Chen, president of the Chinese company Joyvio, together with the president of Australis, Yin Tang, and the executive director, Andrés Lyon, would be the ones called in the initial rounds. According to this report, provided to La Voz de Chile, Shaopeng Chen and Yin Tang will appear on April 21 and 26.

    About Australis Seafood

    Australis Seafoods has come to occupy a leading position in the Chilean salmon industry. This is thanks to the entrepreneurial vision with extensive experience in the business. The company is vertically integrated, in the fish farming, as well as frozen and canned products.

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