SalMar ASA’s proposed share buyout of NTS ASA and also its merger with Norway Royal Salmon ASA (NRS) have received clearance from the European Commission, with the EU executive finding the deals to be compatible with its regulations.
“By unconditionally clearing the transaction, both the Norwegian Competition Authority and the European Commission have confirmed that the transaction will not lead to any significant impediment of effective competition in the market for farming of Norwegian salmon,” SalMar said in a statement.
The Norway-headquartered salmon farming company explained that there was a strong strategic and operational rationale for a completion of the merger and the offer, as well as strong owner, employee and community backing, despite the uncertain situation caused by the Norwegian government’s proposed new tax system for salmon farmers.
It said that it had considered revising the offer terms in light of the tax proposals but felt that this would have “put the combination as such in jeopardy”.
It said, “While the industry will have to scale back and reduce planned investments going forward, the need to seek efficiency and economies of scale has become even greater.
“The entire industry will have to reassess its growth strategies and structures, and SalMar welcomes the increased resource base and operational leverage the transaction entails.”
According to its statement, SalMar expects the merger to facilitate improved capacity utilisation of the companies’ combined maximum allowable biomass (MAB) and site portfolio, as well as the implementation of operational excellence, which in turn should provide better biological results and lower production costs.
Also in connection with the clearance from the European Commission, SalMar has undertaken a commitment to divest its 16,346,824 shares in Arctic Fish Holding AS, currently held by NRS, that will be assumed by SalMar upon completion of the merger.
These shares represent approximately 51.28% of the shares and votes in the Icelandic salmon farming company, with Mowi ASA already lined up to acquire these shares for a price of NOK 115 per share.
