Grieg Shetland sale could net up to £125m, analysts say

The sale of Grieg Shetland could raise up to £125 million for the parent company, analysts in Oslo are predicting.

INDUSTRY experts put the price on Grieg Seafood’s Scottish operations at between a billion and 1.5 billion kroner – and possibly more if there is a bidding war.

Danske Bank Markets analyst Ivar Bakken said Norskott Havbruk (Scottish Sea Farms, jointly owned by SalMar and Leroy Seafood,) and Cooke Aquaculture were expected to be among the main contestants. He also suggested that Bakkafrost, which took over the Scottish Salmon Company for more than £500 million a year ago, could be in the frame.

Grieg Seafood has assured the 160 plus staff who work at its Shetland base that operations will continue as normal until the review on its future is completed – possibly before the end of next year.

The Norwegian fish farming company, which announced a third quarter group loss yesterday, sent shockwaves around the community when it disclosed that it was evaluating plans to sell the business and concentrate its salmon farming efforts on Norway and Canada.

Grieg had already announced plans to cease operations at five farms on Skye once the current harvest has been completed. However, there are others who think that, with incomes shrinking as a result of the Covid-19 pandemic, money to splash out on big purchases could be limited next year.

Grieg is expected to use the proceeds of the sale to plug any financial gaps and boost its Canadian and Norwegian farming operations.

Grieg said it hoped to complete the sale towards the end of next year, although it is not putting a firm timetable on a deal.

Grieg Shetland has been plagued by various biological problems which hit profits during the quarter, but it reported progress in this area last week, making a sale more attractive.