Land-based salmon farmer Atlantic Sapphire announced that it has entered into a restructuring agreement with its largest shareholders and convertible loan holders to address its long-term financing needs.
The transaction, which includes five major investors representing approximately 63 per cent of shares and 93 per cent of the outstanding convertible loan, is intended to provide a minimum of $20 million in new equity liquidity.
Under the agreement, Coral Holding will launch a voluntary offer to acquire the company's shares at NOK0.80 (approximately $0.074) per share, followed by a compulsory acquisition of any remaining minority holdings. The company plans to de-list its shares and warrants from the Euronext Oslo Børs as part of the financial restructuring.
The restructuring also involves a 23 per cent write-down of the outstanding convertible loan, with the remaining portion converted into new shares at NOK0.10 per share. To raise up to $16 million in cash, the company will conduct a private placement divided into three tranches, with the first tranche of $10 million fully underwritten by the investor group.
Atlantic Sapphire reported that its additional capital requirement had risen to between $25 million and $30 million by late March, warning that a failure to secure funds would have led to a technical default under its lending agreements.
The board stated that the company's equity and shareholder value were most likely lost, noting that the bridge loan was necessary to avoid insolvency proceedings.
The remaining members of the board concluded that no feasible alternative sources of financing were available to the company, adding that a previously considered rights issue was replaced to prevent an unfair outcome for minority shareholders.
Additionally, the maturity date for the bridge loan has been extended to August 31, 2026, to allow time for the transactions to complete.
Former shareholders who accepted the voluntary offer will also have the opportunity to participate in a third tranche of the private placement to raise up to $5.85 million.