Marine Harvest’s Cermaq Bid Backed as Rights Issue Rejected

Marine Harvest ASA’s plan to make an improved offer for Cermaq ASA, a Norwegian fish-food maker, was endorsed by investors as Cermaq’s annual meeting rejected a proposed rights issue to fund its purchase of Copeinca ASA.

About 63 percent of shareholders represented at today’s meeting voted in favour of the proposal, less than the two-thirds needed, Cermaq said in a statement. Marine Harvest, the biggest salmon farmer, had said it wouldn’t proceed with its offer for Cermaq if the share issue was approved.

“Now we have to sit down with the board of Marine Harvest and prepare the bid that we have promised,” Chairman Ole-Eirik Leroey said by mobile phone. “There are a lot of elements in this potential offer and we’ll consider all of them and get back to shareholders as soon as we can.” He declined to say by how much Marine Harvest may increase its offer.

The company, controlled by billionaire John Fredriksen, is seeking to buy Cermaq, which operates salmon farms in Chile, Canada and Norway as well as making feed, to expand into fish food as rising raw material prices boost costs. The company is willing to adjust all parts of its offer except for the condition that Cermaq doesn’t buy Copeinca, Leroey said May 16.

Cermaq, based in Oslo, has dismissed the current offer of 105 kroner ($18.03) a share, including a 1 krone dividend, as “inadequate.”

‘Review Options’

Cermaq’s board will now review its options during the “next 24 hours or so,” Chief Executive Officer Jon Hindar said in an interview after the meeting.

“We take note of the fact that this is essentially an expression of our shareholders wishing for an offer” for their shares, he said. “We need to take that into consideration when we review what options we have.”

Cermaq jumped as much as 7.1 percent to 113.5 kroner after the vote, and closed at 112 kroner in Oslo. Marine Harvest gained 3.5 percent to 6.37 kroner.

Cermaq has said it will seek alternative financing for its acquisition of Copeinca if shareholders rejected the planned equity issue. “Let’s say accepting an offer from Marine Harvest is by no means the only option,” Hindar said.

Norway’s government, which owns 43.5 percent of Cermaq, has said Marine Harvest’s current offer is too low. “If there comes a concrete bid and it’s higher, then we’ll have to consider that,” Trade Minister Trond Giske said in an interview on May 15. “We consider all options for Cermaq in a responsible way.”

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