“We are shocked that it is possible to run a company so badly”

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Level of conflict between Coast Seafood and Blom Gruppen comes to the surface in court.

“We have also given loans to Blom’s holding company, so we have really supported the Blom family,” said Sverre Søraa.

The Coast Seafood director has taken the witness stand during the ongoing trial between the exporter and Blom Gruppen. Together they own 34 and 66 per-cent of fish farmer Blom Fiskeoppdrett respectively.

He recounted a business collaboration that went smoothly for a number of years. But earnings at the fish farming company have been weak for many years. This created increased unrest throughout 2019.

Out of control
“We were projected to have a deficit of NOK 5-6 million (EUR 0.5 -0.6 million .ed). This resulted in a deficit of more than NOK 90 million (EUR 9 million .ed). It was clear to us that this was a company without financial control,” said Søraa.

In the spring of 2020, Øyvind Blom was the CEO but he went on sick leave in the spring of 2020. Jakob Blom was appointed as the new CEO. In addition, Carl-Erik Arnesen, who has been CEO of Firda Seafood for 17 years, was engaged as a support for the operation.

“He has considerable knowledge of fish farming,” Søraa said of Arnesen, but stressed that it was not Coast’s proposal to employ him.

At the same time as the deficit was presented, an offer came from Blom Gruppen, of EUR 20 million, for Coast’s ownership of 34 per-cent of Blom Fiskeoppdrett.

From the witness stand, Sverre Søraa went on the offensive.

“We didn’t understand any of the offer that came from Jakob Blom. But I eventually realised that it was because we had stepped on his toes by interfering in the operation. I saw it as my damn duty to take responsibility for this operation,” he said.

The conflict between the parties escalated. In the autumn of 2020, Søraa was ousted from the board of Blom Fiskeoppdrett.

Violated sales agreement
“Carl-Erik Arnesen was supposed to focus on the operation, but then he suddenly turned around to sell fish. It was incomprehensible to us. We quickly confirmed that he violated the sales agreement. The first person he started selling fish to was Firda Seafood. In addition, he began to send fish to Denmark, with “Norwegian Gannet”, of which he was chairman of the board,” said Søraa.

“The company was controlled by Blom Gruppen’s wallet,” said Søraa. He added that Blom Fiskeoppdrett was not governed by Blom Fiskeoppdrett’s interests.

“In connection with the share issue to be carried out tomorrow, we have learned that Blom Fiskeoppdrett will present a deficit of NOK 145 million (EUR 14.5 million .ed). We are shocked that it is possible to run a company so badly. But we will still go in with money,” said Søraa, adding that he has been notified that this money has now been transferred.

The share issue in Blom Fiskeoppdrett is EUR 7.5 million, of which Blom Gruppen will raise EUR 5 million and Coast will contribute EUR 2.5 million.

“I am not aware of such large losses in the aquaculture industry. Normal is to make money. Alsaker has hundreds of millions (NOK .ed) in plus. Firda as well,” said Søraa.

Coast Seafood believes that Blom Fiskeoppdrett’s chairman Torbjørn Gjelsvik, who by email notified them of allegedly low settlement prices, for a long time for Blom Fiskeoppdrett, favoured one of the shareholders in the company.

Atle Johansen Skaldebø-Rød referred to Gjelsvik as the Blom family’s “house lawyer”.

District Court Judge Jarle Ringheim and lawyer Brendan Stewart Mitchell. PHOTO: Aslak Berge

Exception
Blom Gruppen’s lawyer Brendan Stewart Mitchell noted that Gjelsvik is, among other things, chairman of the board of another fish farmer, namely Midt-Norsk Havbruk. He also rejected the fact that Chairman Torbjørn Gjelsvik called a general meeting with one day’s notice.

“It wasn’t like he tried it,” he said.

Mitchell also rejected Coast’s move by the Norwegian Competition and Markets Authority to stop its partnership with competitor Firda Seafood.

“There is an exception to the Fish Farming Competition Act,” said Brendan Stewart Mitchell.

Bergen Courthouse. PHOTO: Aslak Berge