The latest offer, from Stockholm-based Altor and US-based Bain Capital LLC, came as shares of Norwegian salmon fish farmers have reeled in big gains. Shares of Marine Harvest, the world’s largest producer of farmed salmon, have gained 57% over the past 12 months amid rising global demand and concerns about the potential for disease outbreaks in Chile, one of the world’s largest salmon suppliers.
Marine Harvest’s latest offer, delivered last month, valued all of Cermaq, including its fish-farming operations, at 107 kroner a share, or 9.9 billion kroner.
“As I see it, [the private-equity bid] is a better offer than what the Marine Harvest offer implies,” said Geir Kristiansen, an analyst at Sparebank 1 Markets in Oslo. He estimated that the private-equity bid implied a value of 118 kroner a share for all of Cermaq.
Shares of Cermaq, of which the Norwegian government is the largest shareholder, rose 3.2% Monday to close at 112.50 kroner. Cermaq’s stock had gained 52% in the previous 12 months.
Acquiring Oslo-based Cermaq would make Marine Harvest the world’s largest producer of fish feed, which represents about 50% of salmon farmers’ costs. Marine Harvest, of which shipping tycoon John Fredriksen is the biggest shareholder, in 2011 announced plans to enter the feed market.
Cermaq rejected Marine Harvest’s bids as too low. But Cermaq welcomed the offer from Altor and Bain Capital, saying it was “sufficiently interesting” to explore selling the unit. The company said it aimed for a deal to be completed by mid-July, subject to shareholder approval.
Accepting the offer from Altor and Bain Capital would allow Cermaq to reduce debt and pave the way for an extraordinary dividend to shareholders of four billion kroner to five billion kroner, or 43 kroner to 54 kroner a share.
Source: The Wall Street Journal
Published: September 22, 2023