Completion of sale of Icelandic Group operations in the US
Icelandic Group (The Group) has completed the sale of its operations in the United States and the related procurement and manufacturing businesses. The buyer is the Canadian seafood company High Liner Foods (TSX:HLF). The adjusted purchase price was US$232.7 million, which includes US$2.0 million in closing adjustments. In addition, working capital adjustments net of cash balances were US$15.2 million, reflecting the seasonally high working capital levels at the time of the closing of the transaction.
In connection with the sale, Landsbankinn has sold its 19% share in the Group. The Iceland Enterprise Investment Fund now owns the company in full. With the sale of its operations in the United States and divestment of assets in Germany and France, Icelandic Group has now sold assets for a total of ISK 41 billion, with ISK 21 billion of that figure paid by taking over debts. The agreement on the acquisition by the Iceland Investment Fund of an 81% share in Icelandic in 2010 included a provision to the effect that if divestment plans proved successful the Fund would buy Landsbanki's remaining shares in the company. The company now holds 10% of its own shares.
Herdís Fjeldsted, Chairman of the Board of Icelandic Group: “Completing the sale of Icelandic’s assets in the United States, and in particular the sale of assets in France and Germany earlier this year, was an important milestone. Following the reorganisation process, which is now in its concluding stages, the company is financially strong and fully capable of growth and profitability.”
Lárus Ásgeirsson, Icelandic Group CEO: “Following this transaction, Icelandic Group has operations in Iceland, Europe and Asia, with a turnover of approximately ISK 80 billion and 1200 employees. The challenge ahead is to streamline operations still further and strengthen the company’s business. Services to Icelandic producers are very important to our business operations and we will work closely with them to strengthen still further the marketing of Icelandic marine products in foreign markets.”
In March of this year, Icelandic Group plc engaged Merrill Lynch International (“BofA Merrill Lynch”), a subsidiary of Bank of America Corporation, to act as financial advisor to the Group in connection with a review of strategic alternatives. These strategic alternatives were to include, among other things, divestment of one or more of the Group’s businesses as well as equity financings. The sale of the Group’s operations in the United States and related businesses forms part of this review. Merril Lynch International is acting exclusively for Icelandic Group plc in connection with transaction and for no one else and will not be responsible to anyone other than Icelandic Group plc for providing the protections afforded to its clients or for providing advice in relation to the transaction.
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