The Scottish Salmon Company, one of the Outer Hebrides biggest employers, has been acquired by a firm in the Faroe Islands in a £516m deal.
Bakkafrost will take a 69% shareholding in the Edinburgh-based company from the current majority owner, the private equity firm Northern Link. The stake is valued at £356m and the offer will trigger a mandatory offer for the remaining equity.
Bakkafrost is a salmon farming company based in Glyvrar on the island of Eysturoy. It is the largest fish farming company in the Faroe Islands, and one of the biggest private employer in the islands.
Bakkafrost is one of the world's most vertically integrated salmon farming companies. Bakkafrost controls all aspects of production - from feed to finished value added products. This ensures unrivalled traceability and consistent high quality.
The Scottish Salmon Company, which has been quoted up to now on the Oslo stock exchange, operates from 60 sites and has more than 600 employees in total, including at a variety of sites on the Western Isles. It owns exclusive genetic rights to grow Native Hebridean Salmon, which it claims is “stronger, leaner, and noticeably firmer” than Atlantic salmon. It has an extensive social marketing programme, including support for the Western Isles teams attending the International Islands Games.
The company is the second-largest salmon farming firm by harvest volume in Scotland, producing 29,913 metric tons of salmon in 2018 and 18,463 metric tonnes of salmon in the first half of 2019. It reported net operating revenues of £111.8 million for the first half of this year.
SSC CEO Craig Anderson said: “The board of SSC considers this offer to be in the best interest of all shareholders as it realises the material value that has been created after nine successive quarters of growth."
The new owner expects significant savings from supplying its own fish food to SSC farms.
Bakkafrost CEO Regin Jacobsen said: “The Scottish Salmon Company represents an attractive acquisition at this juncture providing exposure to the attractive and premium Scottish salmon farming region with potential for synergies and transfer of best practices.”
In a statement, the company said it is committed to a positive partnership with local Scottish communities and to working within Scotland’s existing regulations for salmon farming – with the caveat that it will seek to “strengthen” those regulations.
“Bakkafrost is committed to strong cooperation with local communities and authorities and hopes to stimulate employment through significant investment in the business. Additionally, Bakkafrost is committed to ongoing work to strengthen the Scottish regulatory framework,” it said.