Bakkafrost acquires fish feed producer

Norwegian salmon farmer Bakkafrost on Monday announced that it has agreed to acquire Faeroe Islands-based fish feed producer Havsbrún for DKK 1.1 billion (USD 213.2 million, EUR 147.6 million).

The acquisition allows Bakkafrost to increase its 2011 salmon production by 7,000 metric tons (gutted weight) to 40,000 metric tons, with room for growth in the coming years.

Havsbrún owns about 78 percent of salmon farmers Faroe Farming and Viking Seafood, which hold a total of five licenses and produced 9,000 metric tons of salmon (gutted weight) in 2010, with an annual capacity of 15,000 ?metric tons.

Havsbrún purchased 116,000 metric tons of raw material in 2010 and produced about 60,250 metric tons of fish feed, 25,000 metric tons of fishmeal and 9,900 metric tons of fish oil. Almost all of the fishmeal and oil is used for its own fish feed production, as only a fraction is exported.

Bakkafrost is Havsbrún’s largest customer, representing about 60 percent of feed sales in 2010, in terms of volume. Havsbrún also owns 33.3 percent of Danish fishmeal producer Hanstholm Fiskemelsfabrik.

The sellers will receive about DKK 403 million of the payment in the form of Bakkafrost shares. The remaining payment will be paid in cash and financed by a combination of new debt financing and existing facilities.

The deal is expected to be completed on 1 June.


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