NORWAY – Aker BioMarine has finalized an agreement to divest its feed ingredients business to a newly formed entity established by American Industrial Partners (AIP) and Aker Capital (Aker).
The new company will be 60% owned by AIP and 40% owned by Aker Capital, with an enterprise valuation of US$590 million.
This strategic move follows Aker BioMarine’s comprehensive review of its feed ingredients division, which was announced in February.
The sale is expected to unlock substantial shareholder value and enable the Norwegian biotech firm to concentrate more on the human health and nutrition sectors.
According to Matts Johansen, CEO of Aker BioMarine, the deal attracted considerable interest from numerous reputable parties, highlighting the value of the feed ingredients business and reinforcing Aker BioMarine’s overall potential.
Pending regulatory approvals, the transaction is anticipated to be completed by the third quarter of 2024. Once finalized, Aker BioMarine plans to refinance its debt to optimize leverage for its remaining business segments.
This move is part of the company’s strategy to drive shareholder value through partnerships and transactions across its business units.
The feed ingredients business, which includes krill meal used in aquaculture feed and pet food, marketed as Qrill Aqua and Qrill Pet, and krill extraction for human consumption, operates three specialized harvesting vessels and one support vessel.
These vessels conduct production in Antarctica using advanced, sustainable harvesting technology.
In February, Aker BioMarine reported significant growth in its feed ingredients division, achieving adjusted revenues of approximately US$156 million for FY23.
The sale of this division allows Aker BioMarine to sharpen its focus on its remaining segments, which include human health ingredients and emerging businesses.
This strategic divestiture underscores Aker BioMarine’s commitment to enhancing shareholder value and capitalizing on growth opportunities in human health and nutrition.
In related news, Aker BioMarine reported a significant year-on-year increase in earnings and growth for the first quarter of 2024.
The company’s EBITDA rose to US$15.2 million from US$6 million, and operating income increased by 13%, from US$68.1 million to US$78.3 million, while the operating loss improved from US$9.4 million in Q1 2023 to US$5.6 million.
CEO Matts Johansen highlighted a rise in krill production volume to 21,306 tonnes from 19,852 tonnes the previous year, attributing the growth to the company’s new operating structure and strategic focus.
While the Consumer Health segment saw a weaker quarter, sales for Feed Ingredients and Human Health Ingredients performed well, and the company noted positive trends in the US private label market, driven by innovation and increased retailer focus on private label offerings.
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