Bakkafrost Group has entered an agreement with Sp/f Hjallur to acquire 51 percent of the shares in P/F Faroe Farming for a cash consideration of DKK 75 million (USD 11.2 million, EUR 10.1 million). The deal will see Bakkafrost become owner of all the shares in the salmon farming company that operates in Suduroy, the southern part of the Faroe Islands, effective 1 July 2016.
At the same time, Bakkafrost has filed two licenses to the Faroese Authorities, which will take its total number of licenses for farming salmon in the Faroe Islands up to 14.
“Bakkafrost expects salmon farming in Suduroy can be significantly optimized. Bakkafrost has announced an investment plan for the next five years, and part of these opportunities can result in increased value for both Bakkafrost, and Suduroy in general,” Bakkafrost CEO Regin Jacobsen said.
P/F Faroe Farming holds three farming licenses in Suduroy. In 2015, its total harvested volume was 4,681 metric tons (MT), with reported revenues of DKK 154 million (USD 23 million, EUR 20.7 million) and earnings before interest and taxes (EBIT) of DKK 13 million (USD 1.9 million, EUR 1.7 million). The 2015 net profit was also DKK 13 million.
As of 31 December 2015, its total assets amounted to DKK 174 million (USD 26 million, EUR 23.4 million) and the equity was DKK 80 million (USD 12 million, EUR 10.8 million).
The daily operations of P/F Faroe Farming will continue unchanged, though from 1 January 2017 it will merge into Bakkafrost Farming.
Earlier this month, Bakkafrost unveiled a new DKK 2.2 billion (USD 328.7 million, EUR 295.7 million) investment strategy for the five-year period 2016-2020 with the main focus to increase the company’s capacity.
The company harvested 10,934 MT of salmon in the first-quarter of 2016, an increase of 12 percent year-on-year. It expects to harvest a total of 48,000 MT of gutted weight salmon in 2016.
