Cermaq agrees to Mitsubishi $1.4 billion acquisition offer

Oslo-based trout and salmon farming company Cermaq ASA announced on Monday that its Board of Directors has unanimously voted to accept a Mitsubishi $1.41 billion (NOK8.88 billion) all-cash takeover offer for its entire issue share capital.

The offer price represents a premium of 14.3% over Cermaq’s closing share value on September 19.

Norway’s majority shareholder, the country’s Ministry of Trade, Industry and Fisheries, which has a 51.17% stake, will publish a separate announcement, Cermaq said. A majority shareholder is any person or entity that owns more than 50% of the common stock.

Rebekka Glasser Herlofsen, Chair of the Board of Directors of Cermaq, said:

“The Offer recognizes the financial and strategic value of Cermaq and delivers an attractive offer premium to the shareholders. In addition, Mitsubishi Corporation represents a strategic and industrial fit by strengthening Cermaq’s presence and reach in the important Asian markets. Together Cermaq and Mitsubishi Corporation will become the world’s second largest salmon farming company, set for further sustainable growth.”

Ms. Herlofsen added that Mitsubishi Coporation offers significant synergies within the seafood sector, making it an attractive industrial owner of Cermaq for local communities where the company operates, customers and employees.

Fondsfinans AS is Cermaq’a financial advisor, while its legal adviser is Advokatfirmaet Schjødt AS.

Cermaq, which operates in Norway, Canada and Chile, is one of the world’s largest salmon and trout farming businesses.

In 2013, the company sold 142,300 tonnes of gutted salmon, which represented approximately 6% of the global market.

The Norwegian government on Monday says it supports the transaction. It added that the Ministry of Trade, Industry and Fisheries is still free to sell its shares elsewhere “if such party should present a more attractive offer than Mitsubishi.”

Mitsubishi shifting to foods

Mitsubishi, like other major Japanese multinationals, has been shifting into the food industry as demand in other sectors in China wane.

In May, 2013, Mitsubishi said it planned to double its profits from non-metal and non-energy operations by 2020.

In June, the Japanese conglomerate signed a deal with Australian grain handling company Olam International Ltd.

In August, Mitsubishi posted 17% lower profit for the last quarter as net income from coal, oil & gas fell from ¥64.4 billion in 2013 to ¥43.4 billion in 2014.