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Illustration of John Risley, serial entrepreneur and founder of Clearwater Seafoods Inc. (Anthony Jenkins/The Globe and Mail)
Illustration of John Risley, serial entrepreneur and founder of Clearwater Seafoods Inc. (Anthony Jenkins/The Globe and Mail)

THE LUNCH

Clearwater Seafoods’ John Risley: He’s still got lots of pots on the boil Add to ...

Both emerged from research undertaken at Ocean Nutrition Canada Ltd., a company he founded in 1997 that has become the world’s largest producer of Omega 3 fatty acids from fish oil. He and his partners sold ONC a year ago for $540-million – which may just be his most satisfying deal, and not just in financial terms. It validated the idea of building a science-based company in the Maritimes, a region best known for exporting commodities.

Much of the rest of his time is devoted to Columbus Communications, a Caribbean telecom company co-founded with Jamaican-born investment tycoon Michael Lee-Chin. Columbus is an industry consolidator in Latin America, and now offers cable services to 500,000 customers and fibre-optic links for 21 countries in the region. While shellfish is a business limited by the harvest, this is a growing company in a high-growth region, and grosses $1.6-billion a year, a number that Mr. Risley expects to double in three years.

Those prospects were reinforced last week, when Columbus struck a strategic alliance with Britain’s giant Cable & Wireless Communications to combine their undersea fibre-optic networks in a $500-million deal. It would leave Columbus with about 72.5 per cent of the combined Latin American venture. For Mr. Risley, it means more cost synergies, the ability to offer scale to companies that use the fibre networks – and to take on a big partner in a capital-intensive business.

Mr. Risley is still Columbus’s majority owner, but Mr. Lee-Chin recently sold his minority interest to John Malone, the legendary U.S. communications tycoon, who in addition to his Liberty Media interests is the largest private landowner in the United States. Mr. Risley says the presence of Mr. Malone is an indication that Columbus has truly arrived. And the two men, both rugged, take-no-prisoners personalities, are kindred spirits. When they first met, they were supposed to talk for an hour but it stretched into five.

Meanwhile, Mr. Risley remains a director and largest shareholder at Clearwater Seafoods. He spends no time on day-to-day stuff – the company is headed by Ian Smith, who became chief executive officer three years ago after more than two decades at food and consumer products giants such as Campbell Soup and Colgate-Palmolive. With naturally sourced seafood in huge demand, Clearwater has been on a nice roll, and Mr. Smith brings a strong marketing focus.

Clearwater has not always been a good story. Mr. Risley and Mr. MacDonald, who is now chairman, took it public a decade ago as an income trust at the equivalent of $10 a share and watched the stock fall to below 50 cents. At one point, they tried to take it private, but the deal fell through in the post-2008 meltdown – and there is conjecture they will try again. (Mr. Risley would not comment on this prospect.) Now, under Mr. Smith, there have been strong sales and the stock price has climbed back to above $4.60.

The rebound failed to quell criticism that while Mr. Risley may be a splendid entrepreneur, he has not made much money for other shareholders. “That’s a great comment and I accept that,” he answers. It was not pleasant to watch the Clearwater stock collapse after going public, he admits. “The only thing to say in our defence is we never sold any shares through any of this and we still believe in the business long term.

“You don’t take a company public to screw the public. Nobody does that,” he says, but he could not have anticipated the Canadian dollar would soar so quickly after going public. “The exchange rates bit us in the ass.”

A happier topic is Ocean Nutrition Canada, a private company that he built and sold to the Dutch multinational nutrition company Royal DSM. “I don’t start companies to sell them, but it reached the point where it really needed global distribution and we couldn’t do that from Halifax,” he says. The best way to grow was by teaming up with the world food giants, but Mr. Risley says ONC was constantly rebuffed. Royal DSM was a willing buyer, which already had relationships with these large companies.

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