Bergen, Norway-headquartered Marine Harvest ASA has entered into a conditional transaction agreement to merge Marine Harvest Chile with Empresas AquaChile SA, the South American country’s leading producer of farmed salmon. The surviving entity, which will conduct business as AquaChile, will continue to be listed on the Santiago Stock Exchange on a stand-alone basis.
Upon completion of the merger, Marine Harvest ASA will own 42.8% of AquaChile. Employing more than 5,500 people, AquaChile is a highly diverse company that operates in Chile, Costa Rica and Panama, with trading offices in the USA. In addition to Atlantic and coho salmon, it produces sea trout and tilapia.
As part of the deal, Marine Harvest has agreed on a standstill position of its ownership in AquaChile until June 15, 2016. For a one-year period thereafter, it will have the option to acquire additional shares through a tender offer that at a minimum will give Marine Harvest an ownership interest of 55%. The price of the transaction will be the higher of US $0.8856 per share and the prevailing stock market price at that time.
Inversiones Patagonia (controlled by the Puchi family) and Holding Salmones (controlled by the Fischer family), each with approximately 33% of AquaChile prior to the merger, have agreed to tender a number of shares that will secure Marine Harvest an ownership interest of a minimum of 55% if the tender offer is launched. After June 15, 2017, the respective standstill and tender offer obligations of Marine Harvest, Inversiones Patagonia and Holding Salmones will expire.
The parties have agreed that the business combination will be executed in such manner to maximize both companies’ competitive advantages and expertise, in order to run sustainable salmon farming operations with a focus on enhancing complementary areas of competence and experience. The combined unit will be the sole vehicle through which AquaChile and Marine Harvest will develop their aquaculture business in the Americas, with the exception of Canada.
Victor Hugo Puchi will remain as chairman of the combined organization and will lead the current management teams through the merger and business combination process.
“The merger is in line with our strategy of forming a world leading integrated protein group,” said Marine Harvest Chairman Ole-Eirik Lerøy. “Our already strong position within salmon farming in Chile will be further strengthened and the combination of these companies will form a very efficient Chilean entity that also will benefit the entire Chilean industry from a sustainability point of view.”
AquaChile and Marine Harvest Chile had combined production of 165,000 gross weight tonnage (GWT) of salmon and 19,000 whole fish equivalent (WFE) tons of tilapia in 2014. The merged entity is expected to have production capacity of approximately 260,000 tons GWT of salmon and 25,000 tons WFE of tilapia.
Meanwhile, Marine Harvest reported its global harvest of farmed salmon during the fourth quarter of 2014 totaled 105,000 tons. Norway was the biggest source of production (70,000), followed by Chile (17,000), Canada, (7,000), Scotland (6,000) and a combination of other countries (5,000).
Operational EBIT for the group was NOK 990 million, down from NOK 1,034 reported during the fourth period of 2013.
