Bergen, Norway-headquartered Mowi has received approval from the European Commission to pursue its acquisition of a controlling stake in Lovund, Norway-based Nova Sea.
The proposed acquisition was first announced in January, with Mowi saying at the time that it planned to up its stake in Nova Sea to 95 percent from its current standing of 49 percent in a NOK 7.4 billion (USD 740 million, EUR 630 million) deal with the firm's parent company Vigner Olaisen.
Mowi’s 17 October announcement of European Commission approval referred to the stock exchange notice of 30 January disclosing the details of the deal, which noted that together, the companies “will have a leading position and will continue to invest in one of the world’s best areas for salmon farming, with an aim to further improve biological performance and fish health.”
The European Commission then opened an investigation into the deal under the E.U. Merger Regulation to determine whether the deal broke competition guidelines but issued a 20 October statement explaining stating it had “concluded that the notified transaction would not raise competition concerns, given its limited impact on competition in the markets where the companies are active.”
Yahoo Finance reported that the Commission found that the company’s markets were sufficiently different since “Mowi is engaged across the full value chain for Norwegian Farmed Atlantic Salmon through feed, farming, sales, and processing, [while] Nova Sea’s business revolves around just farming and primary processing.”
At the time of the January announcement, Mowi CEO Ivan Vindheim said that given Mowi’s long-term relationship with Nova Sea, which dates to 1995, he was confident that the merger was a good investment.
“Nova Sea is a frontrunner in the Norwegian aquaculture industry and is known for its excellent biological performance and industry-leading margins. Over 50 years, the company and the Olaisen family have invested in the organization and developed it into an impressive, fully integrated operation. It is, therefore, with great pleasure that we are now, after 30 years, combining our operations,” Vindheim said.
In that press release, Mowi said that through Nova Sea capacity, it projected that it would be able to harvest 157,000 tons of salmon yearly.
“Value creation and community-building along the coast, and especially in Northern Norway, is very important to us. I believe this will create more value and more jobs in Nordland over time,” Nova Sea Board Chairman Aino Olaisen said at the time.
The deal will now be considered by the Norwegian Competition Authority, the approval of which is the final step in the merger process.
