Following on from its November 2022 announcement it plans to exit the U.K. value-added seafood market, Reykjavik-headquartered Iceland Seafood International (ISI) has signed a letter of intent to sell the loss-making business to an unnamed buyer.
“Further to Iceland Seafood’s announcement on 17 November, Iceland Seafood has today signed a letter of intent (LOI) with a respected industry player to sell its subsidiary Iceland Seafood U.K.,” the company said in a release. “The LOI is a legally non-binding document, but its provisions will serve as key terms in the event of the potential transaction. The parties have agreed to run a swift due diligence process with the aim to complete a binding agreement before end of December.”
ISI had hired MAR Advisors to support its departure from the U.K. value-added sector, following its announcement the ISI board of directors was reviewing the group’s strategy in the United Kingdom.
High costs impacted the company’s H1 2022 results, with a bottom line loss of EUR 2.9 million (then USD 2.4 million) reversing the profits it had seen in H1 2021. The company’s U.K. operations were loss-making in the period. During the announcement of the H1 results, ISI CEO Bjarni Ármannsson said it had “become clear” that it would take longer and cost more than thought to stabilize the firms U.K. operations.
Following the disappointing H1, the company announced the closure of its Grimsby, U.K. operations.
“Although it has been concluded that the U.K. operation is not a strategic fit for Iceland Seafood anymore, the excellent facilities and strong management team in Grimsby can be a great addition to other companies in the sector,” the company said.
ISI said further updates on “the progress made in relation to the proposed transaction and its financial impact” will be provided as it advances.
Photo courtesy of Iceland Seafood International
