Atlantic Sapphire to delist after striking restructuring deal with major investors

Land-based Florida salmon farming company Atlantic Sapphire has agreed a restructuring deal with a group of major shareholders and convertible loan holders that will see it delist from the Euronext Oslo Børs stock exchange, as it continues its efforts to stabilise its finances.

Atlantic Sapphire said the agreement has been signed with its existing investors Condire Management L.P., Nordlaks Holding AS, Nokomis Capital, Strawberry Capital AS and Joh. Johannsson Eiendom AS. Together, the group represents around 63% of Atlantic Sapphire’s shares and 93% of its outstanding convertible loan.

The deal is expected to provide at least $20 million (€17.2m) in new liquidity. It will also reduce the company’s debt through a partial write-down of its convertible loan and the conversion of the remaining amount into new shares for lenders who take part, the company confirmed.

The restructuring plan will see Atlantic Sapphire delisted from the Euronext Oslo Børs, and taken nder the control of Coral HoldCo AS, a joint investment company set up by its main investor group, will make a voluntary offer for Atlantic Sapphire’s shares at NOK 0.80 per share ($0.086 / €0.074). Coral HoldCo is then expected to acquire any remaining minority shares through a so-called "squeeze-out" at the same price, where minority shareholders will be obliged to sell their stakes in the company.

The restructuring also includes a private placement of up to around $16 million, or €13.8 million, at NOK 0.10 per share. The first $10 million tranche is fully underwritten by the investor group, while smaller tranches may be offered to some former loan holders and shareholders, the company said in its announcement.

Atlantic Sapphire noted the transaction remains subject to several conditions, including approval of the offer document by the Financial Supervisory Authority of Norway and approval of relevant resolutions at a company general meeting.

The company has repeatedly warned this year that it needed additional capital. In February, it said it required $15-$25 million, later increasing that estimate to $25-$30 million in March.

In March, the company secured a bridge loan of up to $10 million (€9.2 million), following concerns it was in risk of breaching its loan agreements if it failed to secure new funding. The bridge loan’s maturity has now been extended to 31 August 2026.

The urgency for refinancing came despite reported improvements in operations. The company said that despite operational gains, its cash flow remained under pressure, partly due to the timing of these improvements and ongoing costs.

Announcing the agreement, Atlantic Sapphire stated that it had considered other financing options, including a rights issue for existing shareholders, but concluded that the current structure offered a fairer outcome for minority investors, providing them with "a reasonable opportunity to preserve some of their shareholder value."

The board stated its view that the offer of NOK 0.80 per share or a subsequent squeeze-out at the Tender Offer Price "represents a substantial premium compared to the subscription price in the capital increases proposed through the Transaction."

However, Atlantic Sapphire also said the restructuring does not fully cover its estimated funding needs for the next 12 months or fully restore its equity and liquidity to adequate levels. Despite this, the company’s board said it believed entering into the agreement was “right and prudent”, adding that no alternative financing solution had been available.

Without the transaction, the board said Atlantic Sapphire would likely have faced a "highly uncertain situation" for employees, as well as "limited recovery for the Company's creditors, and a total loss of value for the Company's shareholders."