Norwegian land-based farmer Salmon Evolution ASA has entered into a committed term sheet with banks Nordea and Sparebanken Vest for a senior secured debt financing package of up to NOK 625 million (USD 74.1 million, EUR 62 million) relating to the phase 1 build-out of its first production facility at Indre Harøy, on the country’s west coast.
In a stock exchange notice, the company advised that the debt financing package comprises a NOK 525 million (USD 62.2 million, EUR 52 million) senior secured credit facility which will be used to finance construction capex for Indre Harøy phase 1, and a NOK 100 million (USD 11.9 million, EUR 9.9 million) senior secured overdraft facility which will be used for working capital purposes, the financing of biomass, and receivables.
Both the construction and the term loan facilities have been partly guaranteed by the Norwegian Export Credit Guarantee Agency (GIEK). The loan agreement will be repaid over a 15-year profile and have a three-year term from completion of Indre Harøy phase 1 with two one-year extension options.
“The finalization of this committed term sheet at commercial terms deemed very competitive, is yet another major milestone for Salmon Evolution and secures a fully funded platform for our committed projects,” Salmon Evolution CEO Håkon André Berg said. “We are very grateful for the support shown by the Lenders and GIEK and view this as a solid testament to Salmon Evolution’s technology approach and overall business model.”
Nordea Head of Business Banking Seafood Louise Haahjem said that the bank had followed Salmon Evolution’s development with “great interest” for a long time and was very happy about being able to contribute to the project’s realization.
“The combination of a strong industrial ownership, solid management team, strong ESG profile and a conservative but yet disruptive business model fits very well with Nordea’s ambitions of being a leading financing partner for the Norwegian seafood industry,” she said.
On completion, the Indre Harøy facility is expected to have an annual capacity of approximately 31,500 metric tons (MT) head-on-gutted weight (HOG).
Last month, Salmon Evolution also entered into a joint-venture with Dongwon Industries for the development, construction, and operation of a land-based salmon farming facility in South Korea with an annual production capacity of 16,800 MT HOG, using Salmon Evolution’s hybrid flow-through system (HFS) technology.
