Nordic Aqua Partners raises £24.8m for China salmon RAS

Norwegian company Nordic Aqua Partners, which operates a land-based salmon farm in China, has raised gross proceeds of NOK 350 million (£24.8m) through a private placement of new shares.

In a stock exchange announcement, it said the money will be used for the following:

(i) full funding of the estimated development of Phase 2 of its facility in Ningbo, south of Shanghai,

(ii) repayment of short-term debt,

(iii) investments to solve problems with geosmin,

(iv) working capital formation and

(v) general corporate purposes.

The following investors have subscribed for and been conditionally allocated shares in the issue:

• Kontrari AS (which owns 32.8% of the outstanding shares) has been awarded shares for approximately NOK 126.38m.
• ILCO (which owns 9.2% of the outstanding shares) has been awarded shares for approximately NOK 35.63m.
• AKVA group (indirect owner of 2.9% of outstanding shares) has been awarded shares worth approximately NOK 10m.
• Aino AS, represented by board member Aino Olaisen (who owns 1.2% of outstanding shares), has been allocated shares for a total subscription amount of approximately NOK 4.m.
• Maringto AS, represented by chairman Atle Eide (who owns 1% of the outstanding shares), has been awarded shares for approximately NOK 3.83m.
• Therese Log Bergjord, board member, has been awarded shares for a total subscription amount of approximately NOK 1m.
• Ragnar Joensen, managing director of the company, has been awarded shares for approximately NOK 200,000.
• Tom Johan Austrheim, chief financial officer of the company, has been awarded shares for approximately NOK 200,000.
• Andreas Thorud, CEO of Nordic Aqua (Ningbo) Co. Ltd., has been allocated shares for approximately NOK 200,000.

In August, Nordic Aqua Partners announced that it planned to raise an extra NOK 250 million following problems in July with geosmin, a naturally occurring compound that can give fish an “off” taste.

The money will cover Oslo-headquartered Nordic Aqua's capital expenditure requirements and compensate for a reduced harvest in the second half of this year due to the time that work to solve the geosmin problem will take.

Stage 1 of Nordic Aqua’s recirculating aquaculture system (RAS) facility is completed and has an annual production capacity of around 4,000 tonnes. Construction for an additional 4,000-tonne Stage 2 capacity was initiated in the third quarter of 2023, and the preparations for Stage 3 expansion to 20,000 tonnes are under way.

The company began harvesting fish commercially in April and had been ramping up production week by week. By the end of June, it had harvested 523 tonnes of fish with an average harvested weight of 4.54 kilos (head on gutted) and a low mortality rate of 1.9% from 150 grams to first harvest.

Due to initiatives taken to combat geosmin, the harvest plan for the second half of 2024 was adjusted to a significantly lower level. The company does not expect to have any harvest in the current quarter and 400 to 600 tonnes in Q4 2024. New harvest guidance for 2024 is between 900 to 1,100 tonnes.