SalMar ASA

M&A Activity • Jun 5, 2023

Goldman Sachs Asset Management agrees to acquire 72.11% of the shares in Frøy at NOK 76.50 per share and launch subsequent mandatory offer

Goldman Sachs Asset Management agrees to acquire 72.11% of the shares in Frøy at NOK 76.50 per share and launch subsequent mandatory offer

Frøya, 5 June 2023

Falcon Bidco AS (the "Offeror"), a company indirectly wholly owned by

infrastructure funds managed by Goldman Sachs Asset Management, has entered into

an agreement (the "Transaction Agreement") with NTS AS ("NTS"), a wholly owned

subsidiary of SalMar ASA ("SalMar") (OSE ticker: SALM), and Frøy ASA ("Frøy" or

the "Company") (OSE ticker: FROY), whereby the Offeror on certain terms and

conditions will

i. acquire NTS' entire ownership stake in Frøy, representing approximately

72.11% of the shares in Frøy (the "Share Sale"), and

ii. following completion of the Share Sale make an unconditional mandatory cash

offer to acquire all other shares in Frøy (the "Mandatory Offer", and

together with the Share Sale, the "Transaction").

The Transaction is the result of the strategic review related to the Company

announced on 13 January 2023 (the "Strategic Review"), with focus on maximizing

value for the shareholders in Frøy. Throughout the Strategic Review, NTS and the

Board of Directors in Frøy experienced strong interest from a broad field of

reputable investors identifying the attractive business model and growth profile

of the Company.

A cash consideration of NOK 76.50 will be paid per share in the Share Sale, and

at least the same consideration shall be offered per share in the Mandatory

Offer (the "Consideration"). The Consideration implies a total consideration for

all the shares in Frøy of approximately NOK 6.6 billion (based on 86,348,603

shares outstanding as per 5 June 2023).

The Consideration shall be reduced by the amount of any dividend or other

distributions made or declared by Frøy with a record date after 5 June 2023 and

prior to settlement of the Mandatory Offer, however, the Consideration will not

be reduced as a result of the NOK 0.75 dividend per share announced by Frøy on

28 April 2023 that is expected to be paid on or about 20 June 2023. If the

Consideration in the Mandatory Offer is increased from the Consideration agreed

in the Share Sale, the Consideration to NTS in the Share Sale shall be increased

accordingly.

The Consideration implies:

* A premium of 50% to the closing price of the Frøy shares on the Oslo Stock

Exchange on 12 January 2023 of NOK 51.50, being the last trading day prior

to announcement of the Strategic Review.

* A premium of 30.50% to the volume weighted average share price adjusted for

dividend during the last six months up to and including 2 June 2023.

The Share Sale will close as soon as possible, subject only to:

i. receipt of applicable approvals from competition authorities in Norway and

Ukraine, and the Norwegian Ministry of Trade, Industry and Fisheries

having granted an exemption with respect to the nationality requirements

for NOR registration in the Norwegian Maritime Code applicable to the

vessels owned by the Company;

ii. no relevant authority having taken any form of legal action (whether

temporary, preliminary or permanent) that prohibits the consummation of

the Share Sale or in connection with the Share Sale having imposed

material conditions upon the Offeror, the Company or any of their

respective affiliates; and

iii. the Transaction Agreement not having been terminated in accordance with

its terms.

If condition (i) above has not been met or waived by the Offeror on or before

31 December 2023 or a later date mutually agreed in writing between the parties,

the Share Sale may be terminated by either of the Offeror or NTS.

The Share Sale, and consequently the obligation to launch the Mandatory Offer,

are not subject to any other closing conditions.

It is expected that the Share Sale will be completed during the third quarter of

2023. Upon closing of the Share Sale, the Offeror will become the owner of at

least 62,269,112 shares in the Company, equalling approximately 72.11% of the

total issued outstanding shares and voting rights in the Company, and as such

the Offeror shall following settlement of the Share Sale make the Mandatory

Offer in accordance with Chapter 6 of the Norwegian Securities Trading Act.

The complete terms of the Mandatory Offer will be set out in an offer document

(the "Offer Document") to be sent to the Company's shareholders following review

and approval by the Oslo Stock Exchange pursuant to Chapter 6 of the Norwegian

Securities Trading Act. The Offer Document is expected to be approved during the

third quarter of 2023. The Mandatory Offer may only be accepted based on the

Offer Document.

The Mandatory Offer will not be subject to any closing conditions. The

acceptance period in the Mandatory Offer will be 4 weeks and will commence

following publication of the Offer Document (subject to extension by the Offeror

with up to two additional weeks).

The Mandatory Offer will not be made in any jurisdiction in which the making of

the Mandatory Offer would violate applicable laws or regulations or would

require actions which the Offeror in its reasonable opinion, after having

consulted with the Company, deems unduly burdensome.

If the Offeror following completion of the Mandatory Offer holds 90% or more of

the total issued share capital of the Company representing 90% or more of the

voting rights in the Company, the Offeror will carry out a compulsory

acquisition of the remaining shares in the Company. Following the Mandatory

Offer, the Offeror may also propose to the general meeting of the Company that

an application is filed with Oslo Stock Exchange to de-list the shares of the

Company.

Tavis Cannell, Global Co-Head of Infrastructure within Goldman Sachs Asset

Management comments:

"We are excited to invest in Frøy, as one of the leading companies providing

mission-critical transportation and support infrastructure to the aquaculture

industry. Wellboats and service vessels are vital to enabling best-in-class

farming practices and Frøy is at the forefront of driving sustainability. We

look forward to partnering with Frøy and its management team, employees and

long-standing customers in supporting long-term growth and value creation."

Frode Arntsen, CEO of SalMar comments:

"We are pleased to have successfully completed the strategic review in Frøy

announced earlier this year. Following a constructive process and after reaching

a final agreement we believe we have found the best solution, not only for the

SalMar group, but for all shareholders in Frøy. Following a successful process

with many highly reputable interested parties involved, we have found a buyer

for the shares in Frøy who we believe is a good fit and will be a strong partner

for Frøy in the future."

Frøy comments:

"We are pleased that Goldman Sachs Asset Management is becoming a strategic

partner to us to further strengthen Frøy as a leading integrated provider of

aqua services to fish farmers. By leveraging Goldman Sachs' capital, expertise

and network, Frøy will be well positioned to develop the business with the

intention to continue the sustainable growth of the Company. The team is excited

for the next phase of developing the Frøy group."

The board of directors of the Company (the "Board") recommends that the

Company's shareholders accept the Mandatory Offer. The Board's recommendation is

unanimous. As part of the Transaction Agreement, and subject to customary

conditions and fiduciary duties, the Board has undertaken not to amend or

withdraw its recommendation of the Mandatory Offer. As part of this, and subject

to customary exceptions, the Board has agreed not to solicit competing offers

from third parties.

As the Board's recommendation is made pursuant to the Transaction Agreement, it

does not serve as the formal statement to be made pursuant to sections 6?16 and

6?19 of the Norwegian Securities Trading Act. The Company has in this respect

engaged Pareto Securities AS as an independent third party who, subject to

approval by the Oslo Stock Exchange, is expected to provide the formal statement

about the Mandatory Offer to be issued in accordance with section 6?16 (1) cf.

section 6-19 (1) of the Norwegian Securities Trading Act.

DNB Markets, a part of DNB Bank ASA, is acting as financial advisor and

Advokatfirmaet BAHR AS is acting as legal advisor to NTS and the Company.

Goldman Sachs International, Nordea Corporate Finance, part of Nordea Bank Abp,

filial i Norge and RBC Capital Markets are acting as financial advisors and

Advokatfirmaet Thommessen AS and Linklaters LLP are acting as legal advisors to

the Offeror.

Contacts

Frøy:

Tonje Foss, CEO

Sondre Vevstad, CFO

Tel:

+47 996 10 116

+47 936 54 555

Email:

tonje.foss@froygruppen.no

sondre.vevstad@froygruppen (mailto:sondre.vevstad@froygruppen).no

Falcon Bidco / Goldman Sachs Asset Management:

Joseph Stein

Tel: +44 20 7774 1000

SalMar:

Frode Arntsen, CEO

Tel: +47 482 06 665

Email: frode.arntsen@salmar.no

***

This information is considered to be inside information pursuant to the EU

Market Abuse Regulation and is subject to the disclosure requirements according

to section 5-12 of the Norwegian Securities Trading Act. The information was

submitted for publication, by Håkon Husby on 5 June 2023 at 07:00 (Norwegian

time).

About Frøy

Frøy is a leading integrated provider of aqua services to Norwegian salmon

farmers. With a team of more than 900 aqua service specialists and a modern

fleet of 80 vessels, Frøy offers a wide range of infrastructure solutions to

salmon farmers. The service offering includes transport of fish, sorting,

counting, cleaning of nets, treatment for diseases and lice, inspection,

installation and maintenance of salmon farming sites.

Falcon Bidco in brief

Falcon Bidco is a private limited company (registration number 930 936 936)

incorporated under the laws of Norway with its registered office at c/o

Advokatfirmaet Thommessen AS, Ruseløkkveien 38, 0251 Oslo, Norway. Falcon Bidco

was formed on 20 February 2023 and registered with the Norwegian Register of

Business Enterprises on 2 March 2023. Falcon Bidco is indirectly wholly-owned by

infrastructure funds managed by Goldman Sachs Asset Management. Falcon Bidco has

never conducted and at present does not conduct any form of business, and its

sole business purpose is to implement the Transaction.

About the Goldman Sachs Asset Management Infrastructure business

Bringing together traditional and alternative investments, Goldman Sachs Asset

Management provides clients around the world with a dedicated partnership and

focus on long-term performance. As the primary investing area within Goldman

Sachs (NYSE: GS), we deliver investment and advisory services for the world's

leading institutions, financial advisors and individuals, drawing from our

deeply connected global network and tailored expert insights, across every

region and market-overseeing $2.67 trillion in assets under supervision

worldwide as of 31 March 2023. Driven by a passion for our clients' performance,

we seek to build long-term relationships based on conviction, sustainable

outcomes, and shared success over time. Goldman Sachs Asset Management invests

in the full spectrum of alternatives, including private equity, growth equity,

private credit, real estate and infrastructure.  Established in 2006, the

Infrastructure business within Goldman Sachs Asset Management has consistently

navigated the evolving infrastructure asset class, having invested approximately

$15 billion in infrastructure assets across market cycles since its inception.

We partner with experienced operators and management teams across multiple

sectors, including digital infrastructure, energy transition, transportation &

logistics and essential services.

About SalMar

SalMar is one of the world's largest and most efficient producers of salmon. The

Group has farming operations in Central Norway, Northern Norway and Iceland, as

well as substantial harvesting and secondary processing operations. In addition,

the company is operating within offshore aquaculture through the company SalMar

Aker Ocean and SalMar owns 50% of the shares in Scottish Sea Farms Ltd.

***

The Mandatory Offer and the distribution of this announcement and other

information in connection with the Mandatory Offer and the Transaction may be

restricted by law in certain jurisdictions. When published, the Offer Document

and related acceptance forms will not and may not be distributed, forwarded or

transmitted into or within any jurisdiction where prohibited by applicable law,

including, without limitation, Canada, Australia, New Zealand, South Africa,

Hong Kong and Japan. The Offeror does not assume any responsibility in the event

there is a violation by any person of such restrictions. Persons into whose

possession this announcement or such other information should come are required

to inform themselves about and to observe any such restrictions.

This announcement is not a tender offer document and, as such, does not

constitute an offer or the solicitation of an offer to acquire shares in Frøy.

Investors may accept the Mandatory Offer only on the basis of the information

provided in the Offer Document. Offers will not be made directly or indirectly

in any jurisdiction where either an offer or participation therein is prohibited

by applicable law or where any tender offer document or registration or other

requirements would apply in addition to those undertaken in Norway.

Notice to U.S. Holders

U.S. Holders (as defined below) are advised that the shares of the Company are

not listed on a U.S. securities exchange and that the Company is not subject to

the periodic reporting requirements of the U.S. Securities Exchange Act of 1934

(the "U.S. Exchange Act"), and is not required to, and does not, file any

reports with the U.S. Securities and Exchange Commission (the "SEC") thereunder.

The Mandatory Offer will be made in reliance on the exemption from certain

requirements of Regulation 14E of the U.S. Exchange Act provided by Rule

14d-1(c) thereunder, and otherwise in accordance with the requirements of

Norwegian law. Accordingly, the Mandatory Offer will be subject to disclosure

and other procedural requirements, including with respect to the offer

timetable, withdrawal rights, settlement procedures and timing of payments, that

are different from those that would be applicable under U.S. domestic tender

offer procedures and law. The Mandatory Offer will be made in the United States

by the Offeror and no one else.

The Mandatory Offer will be made to holders of shares of the Company resident in

the United States ("U.S. Holders") on the same terms and conditions as those

made to all other holders of shares of the Company to whom an offer is made. Any

information documents, including the Offer Document, will be disseminated to

U.S. Holders on a basis comparable to the method that such documents are

provided to the Company's other shareholders to whom an offer is made.

The receipt of cash pursuant to the Mandatory Offer by a U.S. Holder of the

shares of the Company may be a taxable transaction for U.S. federal income tax

purposes and under applicable state and local, as well as foreign and other tax

laws. Each holder of shares of the Company is urged to consult his independent

professional advisor immediately regarding the tax consequences of acceptance of

the Mandatory Offer.

It may be difficult for U.S. Holders of shares of the Company to enforce their

rights and any claim arising out of the U.S. federal securities laws, since the

Offeror, NTS, SalMar and the Company are located in and organized under the laws

of countries other than the United States, and some or all of their officers and

directors may be residents of a country other than the United States, and their

respective assets are located primarily outside the United States. U.S. Holders

of shares of the Company may not be able to sue a non-U.S. company or its

officers or directors in a non-U.S. court for violations of the U.S. securities

laws. Further, although U.S. Holders of shares of the Company are not waiving

their rights under U.S. federal laws by accepting the Mandatory Offer, it may be

difficult to compel a non-U.S. company and its affiliates to subject themselves

to a U.S. court's judgement. As used herein, the "United States" or the "U.S."

means the United States of America, its territories and possessions, any state

of the United States of America, and the District of Columbia.

Pursuant to an exemption from Rule 14e-5 under the U.S. Exchange Act, the

Offeror and its affiliates or brokers (acting as agents for the Offeror or its

affiliates, as applicable) may from time to time, and other than pursuant to the

Mandatory Offer, directly or indirectly, purchase or arrange to purchase, shares

of the Company or any securities that are convertible into, exchangeable for or

exercisable for such shares outside the United States during the period in which

the Mandatory Offer remains open for acceptance, so long as those acquisitions

or arrangements comply with applicable Norwegian law and practice and the

provisions of such exemption. To the extent information about such purchases or

arrangements to purchase is made public in Norway, such information will be

disclosed by means of an English language press release via an electronically

operated information distribution system in the United States or other means

reasonably calculated to inform U.S. Holders of such information. In addition,

the financial advisors to the Offeror may also engage in ordinary course trading

activities in securities of the Company, which may include purchases or

arrangements to purchase such securities.

Neither the SEC nor any U.S. state securities commission has approved or

disapproved or will approve or disapprove the Mandatory Offer, passed or will

pass upon its fairness or passed or will pass upon the fairness, adequacy or

completeness of this document or any documentation relating to the Mandatory

Offer.  Any representation to the contrary is a criminal offence in the United

States.

Goldman Sachs International, which is authorised by the Prudential Regulation

Authority and regulated by the Financial Conduct Authority and the Prudential

Regulation Authority in the United Kingdom, is acting exclusively for the

Offeror and no one else in connection with the Transaction, the Mandatory Offer

and the matters set out in this announcement. Neither Goldman Sachs

International nor its affiliates, nor their respective partners, directors,

officers, employees or agents are responsible to anyone other than the Offeror

for providing the protections afforded to clients of Goldman Sachs

International, or for giving advice in connection with the Mandatory Offer or

any matter or arrangement referred to in this announcement.

Nordea Bank Abp, which is under the supervision of the European Central Bank

together with the Finnish Financial Supervisory Authority, is acting (through

its Norwegian branch, Nordea Bank Abp, filial i Norge) as financial adviser to

the Offeror and no one else in connection with the Transaction, the Mandatory

Offer and the matters set out in this announcement.  Neither Nordea Bank Abp nor

its affiliates will regard any other person as its client in relation to the

Offer and the matters set out in this announcement and will not be responsible

to anyone other than the Mandatory Offeror for providing the protection afforded

to clients of Nordea Bank Abp, nor for providing advice in relation to the

Mandatory Offer or the other matters referred to in this announcement. Any

securities activities in the United States by Nordea Bank Abp will be

intermediated by its U.S. registered broker-dealer affiliate, Nordea Securities

LLC, and such activities will be effected only to the extent permitted by Rule

15a-6 under the Securities Exchange Act of 1934.

RBC Europe Limited (trading as "RBC Capital Markets"), which is authorised by

the PRA and regulated by the FCA and the PRA in the United Kingdom, is acting

exclusively for the Offeror and for no one else in connection with the subject

matter of this announcement and will not be responsible to anyone other than

Goldman Sachs Asset Management and Offeror for providing the protections

afforded to its clients or for providing advice in connection with the subject

matter of this announcement.