Andfjord Salmon Group AS - Contemplated private placement

22 May 2024

Andfjord Salmon Group AS ("Andfjord" or the "Company") has retained ABG Sundal Collier ASA, Arctic Securities AS, DNB Markets and SpareBank 1 Markets AS as Joint Bookrunners in connection with a private placement (the "Private Placement") of new shares in the Company (the “Offer Shares”) to raise gross proceeds of between NOK 300 to 350 million. The price per Offer Share in the Private Placement will be determined through an accelerated bookbuilding process. 

The net proceeds from the Private Placement will be used to expand the Company’s production capacity at Kvalnes, ramping up biomass, and for general corporate purposes.

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The following investors have pre-committed to subscribe for Offer Shares in the Private Placement:

- High Liner Foods Incorporated (TSX: HLF), a leading processor and marketer of seafood serving the US and Canada , has pre-committed to subscribe for and will be allocated Offer Shares for the NOK equivalent of USD 10.0 million (approx. NOK 107 million).

- The Company's largest shareholder, Jerónimo Martins Agro-Alimentar S.A (holding 25.1% of the outstanding shares in the Company and represented on the Board of Directors by Antonio Serrano), has pre-committed to subscribe for and will be allocated Offer Shares for the NOK equivalent of EUR 7.5 million (approx. NOK 87 million).

- Jan Heggelund has, through private accounts and through his wholly owned company Ristora AS (combined holding of 2.7% of the outstanding shares in the Company), pre-committed to subcribe for and will be allocated Offer Shares for a total of NOK 30 million.

- Eidsfjord Sjøfarm (holding 4.5% of outstanding shares in the Company and represented on the Board by Knut Holmøy) has pre-committed to subscribe for and will be allocated Offer Shares for its pro rata share.

- Leonhard Nilsen & Sønner AS (LNS), a Norwegian construction specialist holding 0.7% of the outstanding shares in the Company, has pre-committed to subscribe for and will be allocated Offer Shares for NOK 10 million.

Martin Rasmussen, CEO of Andfjord Salmon Group AS, comments: “Our Kvalnes build-out is on track and on budget, and the ‘post-smolt’ opportunity we announced on 29 February this year has generated significant interest from industrial investors. We have decided to utilize this positive momentum to our advantage and raise funds that provide us with added financial flexibility. We are delighted that strong, international industrial investors have pre-committed for substantial amounts”.

The Private Placement will be directed towards Norwegian and international institutional investors, in each case subject to and in compliance with applicable exemptions from relevant prospectus or registration requirements.

The final size of the Private Placement (the "Offer Size") and the number of Offer Shares to be issued will be determined by the Board of Directors of the Company (the "Board") following an accelerated bookbuilding process.

The bookbuilding period for the Private Placement commences today, 22 May 2024 at 16:30 CEST and closes on 23 May 2024 at 08:00 CEST. The bookbuilding period may, at the discretion of the Company and the Joint Bookrunners, close earlier or later and may be cancelled at any time and consequently, the Company may refrain from completing the Private Placement. The Company will announce the final number of Offer Shares placed and the final subscription price in the Private Placement in a stock exchange announcement to be published before the opening of trading on Euronext Growth Oslo tomorrow, 23 May 2024. Completion of the Private Placement is subject to final approval by the Board.

The minimum subscription and allocation amount in the Private Placement will be the NOK equivalent of EUR 100,000, provided that the Company may, at its sole discretion, allocate an amount below EUR 100,000 to the extent applicable exemptions from the prospectus requirement pursuant to applicable regulations, including the Norwegian Securities Trading Act and ancillary regulations, are available. The allocation will be determined after the bookbuilding period and final allocation will be made at the Board's sole discretion. Notification of allotment and payment instructions is expected to be issued to the applicants on or about 23 May 2024 through a notification to be issued by the Joint Bookrunners.

The Private Placement is expected to be settled on a delivery versus payment basis on or about 27 May 2024 by delivery of existing and unencumbered shares in the Company that are already listed on Euronext Growth Oslo pursuant to a share lending agreement (the "Share Lending Agreement") expected to be entered into between the Company, Andfjord Holding AS, OG Invest AS, Skagerak Vekst AS, SpareBank 1 Markets AS and the Joint Bookrunners. The Offer Shares are expected to be issued by the Board pursuant to the board authorisation (the "Board Authorisation") granted by the annual general meeting of the Company held on 7 May 2024, and will be used to settle the share loan pursuant to the Share Lending Agreement. The Offer Shares allocated to applicants will as such be tradable upon allocation. Completion of the Private Placement is subject to a resolution by the Board to issue the Offer Shares pursuant to the Board Authorization. Further, completion of the Private Placement is subject to the Board resolving to consummate the Private Placement and to allocate the Offer Shares, registration of the share capital increase in the NRBE and the Offer Shares being validly issued and registered with the Norwegian Central Securities Depository (VPS).

Members of management and key employees will agree with the Joint Bookrunners to a lock-up for a period of 12 months from the settlement date for the Private Placement, subject to customary exceptions. The Company and Members of the Company's Board will agree with the Joint Bookrunners to a lock-up for a period of 6 months from the settlement date for the Private Placement, subject to customary exceptions.

The contemplated Private Placement involves that the shareholders' preferential rights to subscribe for and be allocated the Offer Shares are set aside. The Board has considered the structure of the equity raise in light of the equal treatment obligations under the Norwegian Private Limited Companies Act, the rules on equal treatment under Euronext Oslo Rule Book Part II and the Oslo Stock Exchange's Guidelines on the rule of equal treatment. The Board is of the view that it is in the common interest of the Company and its shareholders to raise equity through a private placement. The Private Placement enables the Company to secure equity financing to expand the Company's production capacity at Kvalnes, ramping up biomass and for general corporate purposes. Further, a private placement will reduce execution and completion risk and allows for the Company to utilize current market conditions and raise capital more quickly, at a lower discount compared to a rights issue and without the underwriting commissions normally seen with rights offerings. Further, the Subsequent Offering (as defined below), if implemented, will secure that eligible shareholders will receive the opportunity to subscribe for new shares at the same subscription price as that applied in the Private Placement. On this basis the Board has considered the proposed transaction structure to be in the common interest of the Company and its shareholders.

The Company may, subject to completion of the Private Placement, consider conducting a subsequent share offering of new shares (the "Subsequent Offering"). If carried out, the size and structure of the Subsequent Offering shall be in line with market practice. Shareholders being allocated shares in the Private Placement will not be eligible to participate in a Subsequent Offering. The Company reserves the right in its sole discretion to not conduct or cancel the Subsequent Offering.

Advokatfirmaet Schjødt AS is acting as legal advisor to the Company in connection with the Private Placement.

Disclosure regulation

This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to section 5-12 the Norwegian Securities Trading Act. This stock exchange announcement was published by Bjarne Martinsen, CFO at Andfjord Salmon Group AS on 22.5.2024 16:30:00 CEST on behalf of the Company.

CONTACTS‍

Bjarne Martinsen, CFO, +47 975 08 345, bjarne.martinsen@andfjord.no

Martin Rasmussen, CEO, +47 975 08 665, martin@andfjord.no‍

ABOUT ANDFJORD SALMON

Located at Andøya on the Arctic Archipelago of Vesterålen, Norway, Andfjord Salmon is developing the world’s most sustainable and fish-friendly aquaculture facility of its kind. Through a proprietary flow-through system, Andfjord Salmon combines the best from ocean and land-based salmon farming. In its first production cycle, the company achieved an industry-leading survival rate of 97.5 percent, feed conversion ratio of 1.05, superior share of 91.1 percent, and required 1 kWh to produce one kilo of salmon. Andfjord Salmon has identified a roadmap towards a production capacity of 40,000 tonnes HOG at Kvalnes, Andøya, and set a long-term ambition to reach 90,000 tonnes HOG across Kvalnes, Breivika and Fiskenes at Andøya.