Herde Kompositt declares bankruptcy, 63 jobs lost.
Herde Kompositt AS, the Norwegian composite manufacturer responsible for producing the closed-containment aquaculture system known as “the egg,” has filed for bankruptcy, resulting in the loss of 63 jobs.
Employees at the Ølve-based company were informed of the decision on Friday, last week, according to Bergens Tidende . The company had been struggling with a decline in orders for some time.
“We find that many fish farmers are interested in “the Egg”, but they are waiting for clarification regarding the environmental flexibility scheme. [..] We and other suppliers working with low-emission technology need immediate clarification from the Minister of Fisheries,” Cato Lyngøy, chairman of Herde Kompositt and CEO of Ovum, said last year.
He cited weak financial performance and an increasingly challenging economic environment as key factors behind the company’s collapse.
Workforce Reductions and Financial Struggles
In the autumn of 2024, Herde Kompositt announced a reduction in its workforce, cutting between 18 and 23 employees, while an additional 33 to 40 workers were placed on temporary leave. The company reported a turnover of NOK 48.1 million ($4.25 million) in 2023 but recorded a net loss of NOK 4.9 million ($400,000). At the end of the year, its book equity stood at negative NOK 14.4 million (-$1.27 million).
The challenges facing Herde Kompositt mirror those of Ovum, which also announced layoffs last year, terminating eight employees. Unlike Herde Kompositt, however, Ovum did not implement temporary redundancies.
Regulatory Hurdles for Closed-Containment Systems
The “Egg” system, developed as a closed-containment alternative for salmon farming, had been positioned as an innovative solution in the aquaculture industry. However, without regulatory frameworks that support the large-scale adoption of closed containment, both Herde Kompositt and Ovum have faced significant commercial difficulties.
Lyngøy, a former senior executive at Pan Fish and Mowi, acknowledged the structural challenges. “The market conditions and financial outlook have made it impossible to continue operations,” he said.
The bankruptcy underscores the difficulties in scaling closed-containment technology within Norway’s aquaculture sector, particularly in the absence of a licensing regime that incentivizes its development.
