The danger of a diluting NRS share issue was high on the agenda during today’s web conference relating to the merger with SalmoNor.
Earlier this week, it became clear that Norway Royal Salmon (NRS) is merging with NTS ‘fish farming division SalmoNor. Parts of the settlement will be in the form of newly issued shares in NRS. This is precisely what worries minority shareholders in NRS, who fear dilution from the share issue when NRS ‘share price is at its lowest level since the spring of 2018.
CEO Klaus Hatlebrekke emphasized during today’s meeting that valuation and negotiations on the terms of the merger have been conducted at arm’s length and that main shareholder Helge Gåsø has not participated in these talks.
“The issue could be anywhere between NOK 200 million (€20 million) and NOK 2 billion (€200 million). This is something the board must decide on. We hope to land this transaction during the second quarter,” said Hatlebrekke in an almost flawless Mancunian accent.
Together with CFO Ola Loe, Hatlebrekke chaired today’s English-language web conference.
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When asked what issue price they envisage, Hatlebrekke answered evasively and diplomatically:”It is up to the market to decide this transaction. We will come back to that later. We will also ensure that the interests of existing shareholders are protected.”
The NRS top brass were also asked what the new company would be called, and whether the company will maintain the sales office in Kristiansand.”It is up to the board to decide,” Hatlebrekke replied.
In order to avoid a large share issue, with the associated dilution of NRS shareholders who would like to see issue prices close to the all time high in August last year, the sale of assets and debt raising are obvious settlement alternatives for SalmoNor. When asked if a sale of Icelandic Arctic Fish is on the agenda, Hatlebrekke answered:”Arctic Fish has done very well. It’s an option, but it’s a company we like very much.”
NRS owns 51.3 per cent of Arctic Fish, which is valued at NOK 2.8 billion (€280 million). On Thursday afternoon, NRS shares was trading at 8 per cent up.