Industrial giants, according to Bluegrove CEO Bendik Søvegjarto, will be ready to invest money in the Norwegian start-up company – at a startling valuation.
During the summer, the start-up company Bluegrove, formerly known as CageEye, took over the shares in the subsea camera company Sealab in a transaction that priced the former at NOK 2 billion (EUR 190 million). The valuation, of a fairly unknown company, has raised eyebrows many both inside and outside the aquaculture industry. At the last financial statement, for 2018, CageEye had a turnover of EUR 0.4 million. Most of the settlement to Sealab shareholders was in CageEye shares.
Bluegrove, as the corporation is now called, has stated to SalmonBusiness that the high valuation was carried out by “a third party”, but has not been willing to elaborate on who this is or what calculation it based the valuation on.
Multi-million-dollar valuation
At a shareholder meeting on 26 August, shareholders of Sealab Ocean Group requested financial information and basis for the board’s valuation of Bluegrove. In a document, which SalmonBusiness has been given access to, Bendik Søvegjarto, CEO of Bluegrove, explained this. Here he wrote the following:
“We received this summer draft of a Strategic Partnership Agreement with Microsoft, which they normally include with companies such as Nokia, Salesforce, Coca-Cola and Equinor. Microsoft sees us as their entry into aquaculture and has confirmed with a ‘non-binding confirmation letter’ that they will enter the B round with an investment of EUR 6 million on a valuation of EUR 210 million. They will also donate shares to our newly founded Foundation so they can tell the world about this. This is the result of a 14-month process and several trips to Redmond.”
Redmond is Microsoft’s headquarters in Seattle, where representatives of CageEye and Sealab met for the first time last November to probe opportunities for an acquisition.
But it’s not just the US tech giant Microsoft that want in with Bluegrove. German BASF, with an annual turnover of EUR 59 billion, is also interested.
“Furthermore, we have also entered into a strategic partnership with BASF, the world’s largest chemical company, which wants to cooperate with us on the investment in shrimp. We have together a signed MoU (memorandum of understanding .ed), where both financing development costs, as well as an investment of EUR 3-5 million are included,” Søvegjarto wrote.
Global launch
“We have prepared a global launch together with Microsoft, and similarly with BASF, to launch further collaboration. It has always been the plan to combine this with our planned series B roadshow.”
At the end of 2019, CageEye had a book equity of around EUR 3.5 million following several capital injections. Over the past year, the company acquired two other start-up companies, namely NorseAqua and Sealab. This represents the underlying assets now valued at a formidable EUR 210 million.
To support Bluegrove’s multi-million-dollar valuation, Søvegjarto also highlighted other potential major investors:
“We have some big international “bjellesauer” (Norwegian word for “bell sheep”, meaning big visible investors .ed) that want in and are status pending, which we can’t share names by agreement with them.”
Market rumours
When SalmonBusiness asked Bluegrove to elaborate on its strategic cooperation with Microsoft and BASF, the company’s communications manager, Marloes Eshuis, did not want to comment.
“I can neither confirm nor deny this information,” Eshuis told SalmonBusiness.
Nor would BASF comment on the alleged memorandum of understanding.
“Thank you for your interest in BASF. I ask for understanding that we cannot comment on market rumours,” wrote Juliana Tischel, vice president corporate communication at BASF, in an email.
Despite repeated inquiries, over several days, Microsoft’s media department has not returned SalmonBusiness’ requests for comment.
