Kaldvik AS Explores Acquisition of Key Assets in Fish Farming
Kaldvik AS, a notable player in the salmon farming industry, has taken a significant step forward by entering into a non-binding term sheet to acquire essential assets in the fish farming value chain on the east coast of Iceland. This strategic move is set to enhance Kaldvik's operational efficiency and solidify its standing within the competitive fish farming market.
Details of the Acquisition Proposal
The proposed acquisition involves key assets from Heimstø AS and Osnes ehf., entities that play pivotal roles in the local fish farming ecosystem. Specifically, the transaction includes:
- Complete ownership of Mossi ehf., which manages property and facilities for Djupskel ehf.
- Acquisition of Djupskel ehf., a producer of innovative fish boxes.
- A minority stake in Bulandstindur ehf., a fish processing facility in Djupivogur.
These acquisitions are collectively referred to as the "Targets," and they are expected to reshape Kaldvik’s operational landscape significantly.
Expected Benefits of the Transaction
Roy-Tore Rikardsen, the CEO of Kaldvik, expressed optimism about the acquisition, noting that it could reduce packaging costs by approximately NOK 1.5 per harvested kilogram. Such reductions in expenses could substantially improve the company's overall financial performance. Furthermore, full ownership of the harvesting plant in Djupivogur will provide Kaldvik with the necessary flexibility to enhance capacity and quality.
Financial Overview of the Deal
The estimated total cost of acquiring the Targets is projected at NOK 190 million. The financial arrangement specifies that:
- For the shares in Djupskel and Bulandstindur, Kaldvik will issue shares valued at NOK 27.60 each.
- The acquisition of Mossi will involve NOK 40 million provided through an unsecured seller's credit, which can be settled in cash or additional shares at a later date.
All financial arrangements will be subject to typical adjustments based on the cash flows generated from the Targets leading to the closing of the deal.
Transition and Integration Plans
As of June, Mossi and Djupskel reported a combined net interest-bearing debt of approximately NOK 89 million. This debt will be integrated into Kaldvik’s financial structure post-transaction. The management is committed to ensuring a smooth transition and integration of these assets into their existing framework.
Overseeing Advisors and Next Steps
The firm has engaged Pareto Securities AS and AGP Advokater AS to assist in the transaction’s financial and legal aspects, respectively. To proceed with the acquisition, the transaction requires approvals from relevant lenders, completion of due diligence, and the signing of a binding agreement among the involved parties.
The Future of Kaldvik AS
Kaldvik AS stands as a leader in the Icelandic salmon farming sector, recognized for its commitment to sustainable practices through AquaGAP certification. The integration of these new assets is expected to empower Kaldvik's operations further and contribute to its long-term vision of delivering premium, environmentally-conscious salmon products.
Company Overview
Kaldvik AS operates a comprehensive value chain from hatchery to market, a structure that highlights their dedication to quality and sustainability. Headquartered in Iceland, the company is well-positioned to meet growing global demands for responsibly sourced seafood.
Frequently Asked Questions
What is Kaldvik AS planning to acquire?
Kaldvik AS is planning to acquire key assets related to the fish farming value chain on the east coast of Iceland, including shares in influential companies.
How will the acquisition affect Kaldvik's operations?
The acquisition is expected to lower packaging costs and provide Kaldvik with 100% control over a harvesting facility, enhancing its operational flexibility.
What is the estimated purchase price for the assets?
The total estimated purchase price for the assets is NOK 190 million, structured through share issuance and a seller's credit.
Who are the main advisors for this transaction?
Kaldvik has engaged Pareto Securities AS for financial advice and AGP Advokater AS for legal assistance during the negotiation process.
What position does Kaldvik hold in the fish farming industry?
Kaldvik AS is recognized as a leading salmon farmer in Iceland, noted for its sustainable practices and comprehensive value chain management.
