Andfjord Salmon

Share Issue/Capital Change • Feb 26, 2025

Andfjord Salmon - Contemplated private placement and business update

Andfjord Salmon - Contemplated private placement and business update

26.2.2025 16:53:24 CET | Andfjord Salmon | Inside information

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Andfjord Salmon Group AS ("Andfjord Salmon" or the "Company") has engaged ABG

Sundal Collier ASA, Arctic Securities AS and SpareBank 1 Markets AS (the "

Managers") 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 600 million and NOK 650 million. The price per

Offer Share in the Private Placement and the final number of Offer Shares to be

issued will be determined by the Company's board of directors (the "Board"), in

consultation with the Managers, on the basis of an accelerated bookbuilding

process.

The net proceeds from the Private Placement will be used for advancement of the

Company's Phase 2 construction at Kvalnes, optimization of fish logistics for

improved production output, preparations for adherence to expected regulatory

changes, as well as general corporate purposes.

BUSINESS UPDATE:

Andfjord Salmon is pleased to announce significant progress at its land-based

aquaculture facility at Kvalnes, Andøya. The build-out of Phase 1 and shared

operational infrastructure for the next 12 pools at Kvalnes is expected to be

finalized by Q2 2025, in line with the previously communicated timing and

budget. Recent design improvements have enabled a 20% increase in production

capacity, and the Company has received a term sheet signed by the banks for a

NOK 400 million construction loan to support its next expansion phase.

Additionally, Andfjord Salmon has signed a term sheet for a sale and leaseback

agreement of its Kvalnes harbour area infrastructure for approximately NOK 400

million.

The Company is now planning for immediate start of Phase 2a construction which

will allow Andfjord Salmon to benefit from construction synergies due to the

continuous process across phases, e.g., through the retention of personnel and

use of equipment already on-site, optimizing the resource usage and accelerate

execution time.

Please visit the Company's website for an updated company presentation (the "

Company Presentation"):

https://www.andfjordsalmon.com/en/our-investors/reports-and-presentations/.

SELECTED HIGHLIGHTS FROM THE COMPANY PRESENTATION:

- Through optimized pool utilization, including the implementation of a more

efficient and gentle fish logistics system and reinforced concrete walls to

enhance water flow, Andfjord Salmon is set to achieve a 20% boost in production

output at Kvalnes.

- The current build-out phase (Phase 1) expands production capacity from 8,000

tons to up to 11,000 tons (HOG + post-smolt).

- The total production volume under Andfjord Salmon's existing license at

Kvalnes is expected to increase from 19,000 tons to 23,700 tons.

- The Company's blended capital expenditure (CAPEX) per kilogram at Kvalnes is

estimated to be reduced from NOK 114/kg to NOK 105/kg.

- A term sheet signed by the banks for a NOK 400 million construction loan, with

competitive terms provided by SpareBank 1 Nord-Norge, SpareBank 1 Sør-Norge, and

SpareBank 1 SMN, supported by Export Finance Norway (Eksfin).

- An overdraft facility of up to 60% of the borrowing base, which is expected to

be finalized ahead of the first smolt release, is discussed but not yet

committed.

- Andfjord Salmon has also signed a term sheet for the sale of the Kvalnes

harbour area to Asset Buoyout Partners, valued at approximately NOK 400 million.

The transaction is expected to have a positive cash effect of over NOK 200

million, with NOK 200 million from the proceeds allocated to repaying the

existing bank loan linked to the harbour area. The transaction is subject to

final agreements and due diligence, with expected signing of the share purchase

agreement for the transaction in March 2025. Upon completion, the harbour will

be leased back to the Company on an 80-year contract, ensuring continued

operational control.

"Our new fish logistics system enhances flexibility in relocating fish between

pools, unlocking a significant production increase while maintaining Andfjord

Salmon's industry-leading farming conditions," says Martin Rasmussen, CEO.

Further, Martin Rasmussen, CEO adds "The expanded loan is a major milestone in

our expansion at Kvalnes and a testament to the strong support from our lending

partners, who have also backed our Phase 1 development,"

DETAILS ABOUT THE PRIVATE PLACEMENT:

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

Private Placement:

- The Company's largest shareholder, Jerónimo Martins Agro-Alimentar S.A.

(holding 28.04% of the outstanding shares in the Company and represented on the

Board by Antonio Serrano), has pre-committed to subscribe for and will be

allocated Offer Shares for a minimum of NOK 225 million, however that Jerónimo

Martins Agro-Alimentar S.A. will have an ownership of shares in the Company of

minimum 30% upon completion of the Private Placement.

- High Liner Foods, a leading North American processor and supplier of seafood

(holding 5.38% of the outstanding shares in the Company), has pre-committed to

subscribe for and will be allocated Offer Shares for the NOK equivalent of USD

10 million (approx. NOK 111 million).

- Jan Heggelund has pre-committed to subscribe for and will be allocated Offer

Shares for NOK 25 million.

In addition, other shareholders and new investors have indicated to subscribe

for Offer Shares in the Private Placement for an amount that together with the

pre-commitments mentioned above, exceeds the lower end of the Private Placement

size range. 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 bookbuilding period for the Private Placement commences today, 26 February

2025 at 16:40 hours (CET) and closes on 27 February 2025 at 08:00 hours (CET).

The bookbuilding period may, at the sole discretion of the Company, in

consultation with the Managers, be shortened or extended and may be cancelled at

any time. If the bookbuilding period is extended or shortened, the other dates

referred to herein might be changed accordingly. Completion of the Private

Placement is subject to approval by the Board and approval of the issuance of

Offer Shares by an extraordinary general meeting of the Company expected to be

held on or about 13 March 2025 (the "EGM").

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, Regulation (EU) 2017/1129 and

ancillary regulations, are available. The allocation will be determined after

the bookbuilding period and conditional allocation will be made at the Board's

sole discretion in consultation with the Managers. Notification of conditional

allocation is expected to be issued by the Mangers to the applicants on or about

27 February 2025.

The Private Placement is expected to be settled on a delivery versus payment

basis on or about 13 March 2025 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, Jerónimo Martins Agro-Alimentar S.A and the Managers.

The Managers will settle the Share Lending Agreement with new shares in the

Company to be resolved issued by the EGM. The Offer Shares allocated to

applicants will be tradable from the time the market is notified that the EGM

has approved the issuance of Offer Shares.

Completion of the Private Placement is subject to all necessary corporate

resolutions being validly made by the Company, including the approval of the

Private Placement and the conditional allocation of Offer Shares by the Board

and the issuance of the Offer Shares by the EGM. Further, completion of the

Private Placement is subject to registration of the share capital increase

pertaining to the Private Placement with the Norwegian Register of Business

Enterprises and the Offer Shares being validly issued and registered with

Euronext Securities Oslo (VPS).

Members of management and key employees will agree with the Managers 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 Managers to a lock-up for a period of six

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 for advancement of the Company's Phase 2

construction at Kvalnes, optimization of fish logistics for improved production

output, preparations for adherence to expected regulatory changes, as well as

general corporate purposes. Further, a private placement will reduce execution

and completion risk and allows 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, inter alia, completion of the Private Placement,

relevant corporate resolutions, including approval by the Board, prevailing

market price of the Company's shares and approval and the publication of a

prospectus, consider conducting a subsequent offering of new shares (the "

Subsequent Offering") at the same subscription price as in the Private Placement

and otherwise in line with market practice. Shareholders being allocated shares

in the Private Placement, and shareholders who are resident in a jurisdiction

where such offering would be unlawful or would (in jurisdictions other than

Norway) require any prospectus, filing, registration or similar action, will not

be eligible to participate in a Subsequent Offering. Further information on any

Subsequent Offering will be given in a separate stock exchange release when

available. The Company reserves the right in its sole discretion to not conduct

or cancel any 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 of the Company, at the date

and time set out herein, on behalf of the Company.

CONTACTS

* Investors: Bjarne Martinsen, CFO, Andfjord Salmon Group AS, +47 975 08 345,

bjarne.martinsen@andfjord.no

* Media: Martin Rasmussen, CEO, Andfjord Salmon Group AS, +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. For more information, see

www.andfjordsalmon.com - http://www.andfjordsalmon.com -

http://www.andfjordsalmon.com/.

Important notices

This announcement is not and does not form a part of any offer to sell, or a

solicitation of an offer to purchase, any securities of the Company. The

distribution of this announcement and other information may be restricted by law

in certain jurisdictions. Copies of this announcement are not being made and may

not be distributed or sent into any jurisdiction in which such distribution

would be unlawful or would require registration or other measures. Persons into

whose possession this announcement or such other information should come are

required to inform themselves about and to observe any such restrictions.

The securities referred to in this announcement have not been and will not be

registered under the U.S. Securities Act of 1933, as amended (the "Securities

Act"), and accordingly may not be offered or sold in the United States absent

registration or an applicable exemption from the registration requirements of

the Securities Act and in accordance with applicable U.S. state securities laws.

The Company does not intend to register any part of the offering or their

securities in the United States or to conduct a public offering of securities in

the United States. Any sale in the United States of the securities mentioned in

this announcement will be made solely to "qualified institutional buyers" as

defined in Rule 144A under the Securities Act.

In any EEA Member State, this communication is only addressed to and is only

directed at qualified investors in that Member State within the meaning of the

Prospectus Regulation, i.e., only to investors who can receive the offer without

an approved prospectus in such EEA Member State. The expression "Prospectus

Regulation" means Regulation 2017/1129 as amended together with any applicable

implementing measures in any Member State.

This communication is only being distributed to and is only directed at persons

in the United Kingdom that are (i) investment professionals falling within

Article 19(5) of the Financial Services and Markets Act 2000 (Financial

Promotion) Order 2005, as amended (the "Order") or (ii) high net worth entities,

and other persons to whom this announcement may lawfully be communicated,

falling within Article 49(2)(a) to (d) of the Order (all such persons together

being referred to as "relevant persons"). This communication must not be acted

on or relied on by persons who are not relevant persons. Any investment or

investment activity to which this communication relates is available only for

relevant persons and will be engaged in only with relevant persons. Persons

distributing this communication must satisfy themselves that it is lawful to do

so.

Matters discussed in this announcement may constitute forward-looking

statements. Forward-looking statements are statements that are not historical

facts and may be identified by words such as "believe", "expect", "anticipate",

"strategy", "intends", "estimate", "will", "may", "continue", "should" and

similar expressions. The forward-looking statements in this release are based

upon various assumptions, many of which are based, in turn, upon further

assumptions. Although the Company believes that these assumptions were

reasonable when made, these assumptions are inherently subject to significant

known and unknown risks, uncertainties, contingencies and other important

factors which are difficult or impossible to predict and are beyond its control.

Actual events may differ significantly from any anticipated development due to a

number of factors, including without limitation, changes in investment levels

and need for the Company's services, changes in the general economic, political

and market conditions in the markets in which the Company operate, the Company's

ability to attract, retain and motivate qualified personnel, changes in the

Company's ability to engage in commercially acceptable acquisitions and

strategic investments, and changes in laws and regulation and the potential

impact of legal proceedings and actions. Such risks, uncertainties,

contingencies and other important factors could cause actual events to differ

materially from the expectations expressed or implied in this release by such

forward-looking statements. The Company does not provide any guarantees that the

assumptions underlying the forward-looking statements in this announcement are

free from errors nor does it accept any responsibility for the future accuracy

of the opinions expressed in this announcement or any obligation to update or

revise the statements in this announcement to reflect subsequent events. You

should not place undue reliance on the forward-looking statements in this

announcement. The information, opinions and forward-looking statements contained

in this announcement speak only as at its date, and are subject to change

without notice. The Company does not undertake any obligation to review, update,

confirm, or to release publicly any revisions to any forward-looking statements

to reflect events that occur or circumstances that arise in relation to the

content of this announcement.

Neither of the Managers nor any of their respective affiliates makes any

representation as to the accuracy or completeness of this announcement and none

of them accepts any responsibility for the contents of this announcement or any

matters referred to herein. This announcement is for information purposes only

and is not to be relied upon in substitution for the exercise of independent

judgment. It is not intended as investment advice and under no circumstances is

it to be used or considered as an offer to sell, or a solicitation of an offer

to buy any securities or a recommendation to buy or sell any securities in the

Company. Neither the Managers nor any of their respective affiliates accepts any

liability arising from the use of this announcement.