Smoked salmon processing. (Photo: Morpol)

Marine Harvest buys 48.5 per cent of Morpol

NORWAY
Monday, December 17, 2012, 23:30 (GMT + 9)

The Board of Directors of Marine Harvest has entered into an agreement with Friendmall Ltd. and Bazmonta Holding Ltd. to acquire 48.5 per cent of the shares in Morpol ASA for NOK 11.50 per share. Marine Harvest intends to submit a mandatory offer for the remaining shares in Morpol.

The purchase will be carried out on 18 December 2012 and the total purchase price will be NOK 937.6 million (EUR 126.7 million). From the purchase price, NOK 512.6 million (EUR 69.6 million) will be paid in cash and the remaining NOK 425 million (EUR 57.4 million) will be paid through an issuance of NOK 83.6 million Marine Harvest shares to Friendmall Ltd. and Bazmonta Holding Ltd. based on a subscription price of NOK 5.08 per share. The subscription price equals the volume weighted average price of the Marine Harvest share 12-14 December 2012.

From the cash consideration, NOK 425 million (EUR 57.65 million) will be financed through the issuance of 83,600,527 shares to Geveran Trading Co. Ltd. at the same subscription price. The shares will be issued under the Board's authorisation granted by the Annual General Meeting of 4 June 2012.

Subsequent to the completion of the purchase, Marine Harvest intends to submit a mandatory offer for the remaining Morpol shares. Such offer will represent a premium of 38.6 per cent to the closing price 14 December 2012 and a premium of 44.6 per cent to the volume weighted average price the last 30 days. Such offer will be submitted within the 4 weeks period required by the Norwegian Securities Trading Act.

Morpol is the world leader in value added processing of smoked and marinated salmon. The company is listed at Oslo Stock Exchange and is present in all main markets for salmon with sales offices in a number of countries, including Japan and US. The company has processing/distribution facilities in Poland, France, UK and Germany.

"Morpol's activities and large range of high quality products fit very well with Marine Harvest's current processing business as well as our downstream strategy. Morpol has its main market in Germany, but sells into a total of 39 countries," said the CEO in Marine Harvest, Alf-Helge Aarskog. "Marine Harvest has very limited sales of smoked products in the German market today. A future integration with Morpol will hence offer complementary benefits to today's Marine Harvest."

Friendmall Ltd. and Bazmonta Ltd. are controlled by Morpol's CEO and founder Mr. Jerzy Malek. Further to the purchase of Morpol shares, Marine Harvest has committed to future board resolutions in Morpol for the purpose of divesting Morpol's farming activities of non-salmon species (Cobia etc.) to companies controlled by Jerzy Malek for a consideration of USD 10.0 million. Furthermore, Marine Harvest has entered into similar agreements to purchase the technical services entity Euro-Industry for a consideration of EUR 10 million, 78.3 per cent of the shares in the Polish sales company Epigon based on a 100 per cent  valuation of EUR 4.2 million and 100 per cent of the shares in the processing company MK Delikatesy for a consideration of EUR 2.5 million. Marine Harvest is convinced that these transactions will streamline Morpol's assets further, and hence be positive for its long term value creation.

"We appreciate Jerzy Maleks strong wishes take part in the future development of Marine Harvest through a significant shareholding," said Aarskog.

Since the listing at Oslo Stock Exchange in 2010 Morpol has acquired high quality assets within farming of salmon in Norway and Scotland. The company aims to harvest a total of 30,000 tonnes in 2013.

In Norway, Morpol owns a fully integrated company in Troms County. This is a new geographic area for Marine Harvest and will be an important area for Marine Harvest to pursue future growth.

"The purchase of the Morpol stake is in line with Marine Harvest's strategy of forming a world leading integrated protein group, said Marine Harvest Chairman Ole-Eirik Lerøy.

"Together with our recent announcement regarding our organic investment in feed production, the transaction will give Marine Harvest a great starting point to become a unique integrated protein provider. The Board believes that such strategy will provide significant operational benefits, as well as boosting and stabilising the long term earnings power of the group."

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