Size matters: why Nova Sea majority owner is selling to Mowi
Required innovation and development is done better in a larger context, says chairwoman
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Mowi has entered into an agreement with family-owned Vigner Olaisen AS to purchase its shares in Norway's sxith-largest salmon farmer, Nova Sea AS for NOK 7.4 billion (approximately £525.8 million or €628.6m). This will increase Mowi's ownership in the company from 49% to 95%.
Mowi also states that it will make a voluntary cash offer on similar terms to the shareholders who own the remaining 5% of Nova Sea.
During a press conference at Quality Hotel Ramsalt in Bodø this morning, the chairwoman of Nova Sea, Aino Olaissen, said it was a special day for the company and the family, reports Fish Farming Expert's Norwegian sister site, Kyst.no.
"For 53 years, the main focus has been to develop and create Nova Sea. The process up to now has been marked by a lot of emotions. The company has been and is a very large part of our identity."
Why sell?
Aino points out that Nova Sea is Norway's sixth largest producer and has done well on its own, and therefore some might question the decision to sell.
"We are not doing this because we have to, but because it is right for the industry. I feel that we as an industry are facing a shift in pace. We are now entering a more mature phase."
Olaissen points out that the industry has become much more visible and faces major challenges, including in welfare and technology. She therefore believes it is necessary to operate in a different way.
"I am convinced that a lot of work needs to be done on innovation and development. To accelerate and strengthen this, we believe that this process means Nova Sea is better off in a larger context together with Mowi.
"The most important thing we do as salmon farmers is to ensure good welfare in the pens. It's a focus we must never stop addressing, but there is also no silver bullet," she adds.
She points out that work must be done on many different factors that are time-consuming and highlights, among other things, genetics, technology, biosecurity, and artificial intelligence as elements with great potential for improvement.
She believes this process will be better carried out together with Mowi.
Establishing a new fund
As part of the agreement, Mowi and Nova Sea will establish a development fund to facilitate growth and industrial development in production area 8, primarily the Helgeland coast. It is one of Norway's 13 salmonid production areas along the length of its west coast, from south to north.
All strategic projects under way in Nova Sea will be continued. Mowi / Nova Sea will, among other things, continue the construction of a processing plant in Lovund. It will also complete investments in hatcheries, and all technology projects at sea will be continued.
Mowi chief executive Ivan Vindheim opened his comment by pointing out that some days are more exciting and enjoyable than others, and that this was definitely such a day.
"Mowi, as many know, is the world's largest salmon farmer and produces every fifth salmon consumed in the world. Nova Sea has been around almost as long as us and has delivered industry-leading margins and biological performances, so hats off to them."
'Bigger than agriculture'
Together, the companies will produce 572,000 tonnes of salmon worldwide, of which 367,000 tonnes will be grown in Norway.
"The entire Norwegian agricultural industry produces a total of 360,000 tons a year. Mowi and Nova Sea together produce more than the entire Norwegian agricultural industry combined," claims Vindheim.
He points out that the transaction opens up great opportunities. Among other things, he highlights coordinated operations, coordinated site structure, better utilisation of permits, better biosecurity, and better biological performances. This in an area he claims has the best biological results in the world.
"We see that the demands and expectations on us are increasing. The ocean we operate in is changing as a result of climate change. We must address this with innovation, technology, investments, and, not least, more expertise. Together, we are better equipped to meet these challenges," says Vindheim.
