Andfjord Salmon nets USD 57 million through private placement

Norwegian land-based salmon farmer Andfjord Salmon has successfully raised NOK 615 million (USD 57 million, EUR 52 million) through a private placement.

Andfjord announced the contemplated private placement on 26 June, with a goal to raise gross proceeds of between NOK 550 million and NOK 650 million (USD 51 million to USD 60 million, EUR 46.5 million to EUR 55 million). Less than eight hours later the same day, the company announced on the Oslo Børs that it had successfully raised the funds it needed.

The funds were raised through an allocation of 15,974,026 offer shares sold at a subscription price of NOK 38.50 (USD 3.57, EUR 3.25). ABG Sundal Collier, Arctic Securities, and SpareBank 1 acted as Joint Bookrunners on the private placement.

The majority of the shares were allocated to Jerónimo Martins Agro-Alimentar, which purchased 10 million shares at a value of NOK 385 million (USD 35 million, EUR 32 million). Jerónimo Martins is a Portugal-based international food industry group that first invested in the company in June 2022, and has since become one of the company’s largest shareholders.

The proceeds from the private placement, the company said, will be used to expand production capacity at its Kvalnes facility, located on the island of Andøya, and for general corporate purposes. The successful private placement comes soon after the company announced it plans to progress with a build-out of the facility, targeting 40,000 metric tons (MT) of head-on gutted salmon production in the next seven years.

Andfjord first announced that the company plans to expand its facilities on 3 June after it successfully secured a NOK 700 million (USD 64 million, EUR 59 million) loan from SpareBank 1 Nord-Norge and bank alliance partners, including Eksfin. That loan total later increased to NOK 825 million (USD 76 million, EUR 69 million) on 20 June as SpareBank 1 SMC confirmed a commitment to take part in the bank consortium.

That increase replaced a NOK 125 million (USD 11.5 million, EUR 1.5 million) allowance for the leasing facility in the loan documentation, the company said. That facility was originally intended to fund equipment in its construction phase.

The company also recently announced its first successful production cycle, with “good fish welfare and health,” with the first harvest planned in late June or early July.

Earlier this month Andfjord Salmon CEO Martin Rasmussen said the company is in a “very strong position” as it plans for future growth.

“We have a clear roadmap to 90,000 MT annual production at Andøya,” Rasmussen said during a capital markets update. “Salmon, as a product, has been very strong over many years … but there is a gap between supply and the demand. There are limits to how much you can grow with traditional salmon farming. We need other alternatives to close the gap. Some have chosen to go offshore, but we have chosen to go on land and utilize the natural coastal advantages that we have at Andøya.”  

Photo courtesy of Andfjord Salmon