Canadian seafood company Cooke is set to acquire Australian fish farming giant Tassal Group Limited (ASX: TGR) for $1.1 billion. The Company has entered into a Scheme Implementation Deed (SID) with Cooke Inc. under which Cooke has agreed to acquire 100% of the ordinary shares in Tassal.
Should the bid be successful in securing regulatory and shareholder approvals, Tassal shareholders will receive $5.23 per Tassal share held, assuming no final dividend is declared and paid for FY22. However, shareholders are on the fence as they previously rejected a similar offer from Cooke because it did not reflect Tassal’s business value.
On June 28, 2022, Tassal announced that it had received a non-binding, indicative, incomplete and conditional proposal from Cooke to acquire 100% of Tassal’s ordinary shares by the same way of scheme of arrangement at an indicative cash price of $4.85 (“Indicative Proposal”). However, this proposal was rejected by the Tassal Board.
A revised proposal was then submitted by Cooke today at the higher $5.23 offer price.
Tassal Chair James Fazzino commented, “The Tassal Board believes the revised proposal reflects appropriate long-term value for the business, and is unanimous in its view that the Scheme is in the best interests of Tassal shareholders.”
The Scheme Consideration implies an equity value for Tassal of approximately $1.1 billion and an enterprise value of $1.7 billion. It represents an uplift in equity value of approximately 12% compared to the indicative cash price of $4.67 initially proposed by Cooke. The price of $5.23 per Tassal share represents a 49% premium to the Company’s closing price of $3.52 on June 22, 2022, which was the last trading day before the press reports of Amore Foods Pty Ltd (an entity affiliated with Cooke) acquiring a stake in Tassal.
The price also denotes a 47% premium to the 1-month volume-weighted average price (“VWAP”) of $3.55 and a 46% premium to the 3-month VWAP of $3.59.
The Company is urging Tassal’s shareholders to vote in favour of the Scheme at the Scheme Meeting which will be held in November 2022. It is expected to be implemented before the end of 2022.
Managing Director and CEO Mark Ryan noted, “We believe in sustainably produced food and in responsibly harnessing our precious water resources. Combining our two companies’ people-first cultures and our shared passion for producing top quality seafood, is a natural fit. A future acquisition by Cooke enables Tassal to fast-track our goal to be one of the world’s most transparent and sustainable protein producers.”
Cooke is a Canadian seafood company with Atlantic salmon farming operations in Atlantic Canada, the United States, Chile, and Scotland; seabass and seabream farming operations in Spain. The company has a global workforce of over 10,000 employees in 10 countries. Globally, Cooke harvests and sells 30% wild seafood and 70% farmed seafood.
Alinda is a Business Reporter for The Sentiment
Latest posts by Alinda Gupta (see all)
- Ovanti’s iSentric signs contracts worth $14.4m with Malaysian commercial bank - June 27, 2024
- Baby Bunting fights back from retail downturn with 5-year strategy, includes Gen-Z focus and self-funded growth - June 27, 2024
- CLEO meets with US FDA to develop strategy for ovarian cancer test launch - June 26, 2024
Leave a Comment
You must be logged in to post a comment.