Last week New Zealand's two leading fishery companies, Moana New Zealand and Sanford, signed a long-term agreement regarding Sanford's North Island inshore fishery. WeAreAquaculture has gained access to the details of the deal.
Although the agreement has been signed, its validity hinges on obtaining approval from the New Zealand Commerce Commission. This institution would have to grant Moana authorization concerning the transaction. As well as Sanford should agreeing to terms for the interruption of payment processing with an existing payment processing client.
Apart from the New Zealand Commission, the transaction is subject to other conditions, including a regulatory one. As such, settlement is expected to occur in the Q4 of 2023, but this will depend on when the conditions are fulfilled.
On the other hand, in the announcement, both companies talked about the agreement being of long duration. Now it is specified that the minimum term is approximately ten years.
Sanford owns approximately 20% of New Zealand's fishing quota and has interests in salmon and mussel aquaculture. Accordingly, the information, Sanford would retain ownership of the quota for these species in the North Island despite the agreement. In addition, the company would also continue to hold the quota in several deepwater and inshore fisheries in the South Island.
Otherwise, the main feature of the operations has always been to establish a lower-risk passive income. Consequently, for Sanford, the value of this ACE package starts at almost AUD 11 million annualized for the first year and increases to AUD 13 million over the next five years before ramping up in fixed increments of 1.5% per year.
As part of the agreement, Sanford will sell two of its coastal vessels, along with a range of processing equipment and refrigeration vehicles/trailers, to Moana. Moreover, this agreement would include a marine farm comprised of three coastal permits in the port of Croisilles. The price paid by Moana for these ancillary assets is expected to range between AUD 5 million and AUD 8 million (depending, in part, on Moana's final asset valuations and selections).
The transaction ends with the closure of the fish processing plant in Auckland and Sanford, although both companies will work to facilitate the employment of affected staff where feasible.
Moana New Zealand is the largest Māori-owned fisheries company in Aotearoa. Therefore, the company values responsibility, respect for kaimoana, and the welfare of future generations. Finally, it shares New Zealand's finest kaimoana with the world.
Sanford is New Zealand's largest seafood company, engaged in salmon and mussel farming, and holds almost 20% of the country's commercial fishing quota and the oldest listed company. With a strong emphasis on sustainability, the company endeavors to optimize the value of the resources sourced from Aotearoa's oceans. Sanford has operations spanning 15 locations and employs a committed workforce of 1,400 staff members and share fishers.