AquaBounty agrees to sell Indiana salmon RAS for $9.5m

Wisconsin-based salmon and leafy greens producer Superior Fresh has agreed to buy AquaBounty’s land-based salmon farm in Albany, Indiana, for $9.5 million, AquaBounty said in a market filing today.

The deal includes equipment, and is subject to customary adjustments, said AquaBounty, which grows the AquAdvantage strain of Atlantic salmon that inherit a genetic modification to make them grow more quickly.

Portions of the proceeds of the sale are expected to be used to reduce AquaBounty’s secured term loan with JMB Capital Partners Lending, LLC, the company said. It added that the sale is expected to be completed this month.

Aquaponics

Superior Fresh, situated near Northfield, around 100 miles east of Minnesota, uses an aquaponics system that utilises nutrients from its land-based salmon farm as fertiliser for salad greens grown with their roots in water. The process cleanses the water which can then be returned to the fish tanks.

Unlike AquaBounty, the company doesn't see the advantage of genetic engineering, even in plants, and states on its website that its fish east a non-GMO, organic diet. It says its fish contain twice the omega-3 content of other salmon, and " are not fed like most farmed fish, which are too often fed with formaldehyde, pesticides, antibiotics, and GMOs".

Objective achieved

AquaBounty put its 1,200-tonnes-per-year Indiana facility on the market in February to raise cash. The company is building a 10,000-tonne RAS facility in Pioneer, Ohio, but paused work last year due to rising costs which had increased to nearly $485 million - $495 million.

“The Indiana land-based, recirculating aquaculture facility has been growing AquaBounty’s GE (genetically engineered) Atlantic salmon since 2019 and has succeeded in its objective to demonstrate the Company’s ability to grow and sell its salmon in the market,” AquaBounty said in a press release in February.

Needed liquidity

“With construction on its Ohio farm site roughly 30% completed, the Company plans to prioritise the financing alternatives necessary to resume and complete its construction, while the proceeds from the sale of its Indiana farm are expected to provide needed liquidity to AquaBounty’s balance sheet.”

In April, AquaBounty took out a short-term $10m loan from JMB Capital Partners Lending to raise working capital and buy up an existing debt and put up both the Indiana farm and its yet-to-be-completed Ohio RAS facility as collateral. The loan matures at the end of this month, or, if earlier, upon the sale of certain collateral or upon an event of default.

Last month, AquaBounty announced that company president David Melbourne was taking on the added role of chief executive, taking over from Sylvia Wulf, who continues as non-executive chair of the company’s board.