Iceland Seafood International (ISI) plans to merge two UK subsidiaries, Iceland Seafood Barraclough Ltd and Havelok Ltd, into a single unit under one leadership team at the recently acquired 5 Star Fish facility in Great Grimsby Business Park. Following a period of refurbishment, transfer of Havelok and Iceland Seafood Barraclough operations to the site are scheduled for completion by early 2021. It will conduct business as Iceland Seafood UK Ltd.
The investment for facility acquisition, refurbishment and machinery is between £5 million and £6 million, while the total deal including acquisition of minority shares amounts to between £8 million and £9 million. The site includes cold storage capacity of about 2,000 metric tons and three processing areas occupying about 10,000 square meters of space dedicated producing frozen and chilled coated finfish and shellfish items for retail and foodservice markets in the United Kingdom.
“We will in due course elaborate on the financial implications for the merged entity and for Iceland Seafood as a whole – but the impact will be in 2021 and onward and will financially depend on the reception of our customers for our services and our ability to process seafood for the UK market efficiently and competitively,” said the company in a statement issued on March 4.
Iceland Seafood has entered into a £3 million share purchase agreement with the management of Havelok, which jointly holds 33% of the shares in the business. Following the transaction the buyer will hold 100% of the shares in both Havelok and Iceland Seafood Barraclough. Half of the payment will be made with cash and the other half with shares in the company.
Danny Burton the will continue as a director in the new merged entity, in charge of operational teams and refurbishment. Peter Hawkins will head up the overall operation as managing director.
“Following our NASDAQ main market listing in Iceland in October 2019, where €15.2 million in new equity was raised, we announced our intent to make strategic investments in our key markets. The announcement today represents one of these,” said Iceland Seafood CEO Bjarni Ármannsson. “We have strong businesses and management teams in the UK and with the continued support of our existing customers, our people and our suppliers are confident that we can become stronger as a result of the merger.”
Iceland Seafood International generated annual revenue of €450 million last year. The company has a market capitalization of €166 million, with 7 value-added factories and 12 businesses active in countries.