Proximar Seafood's facility at the foot of Mount Fuji in Japan.

Land-based salmon farmer lines up new investor

Proximar needs extra £3.3m for Japan project


Norwegian land-based salmon farmer Proximar is in talks with a potential investor as it seeks to raise around NOK 45 million (£3.3m) towards the cost of completing its recirculating aquaculture system (RAS) facility in Japan, reports LandbasedAQ, one of Fish Farming Expert’s Norwegian sister sites.

Proximar, which intends to produce 5,300 gutted weight tonnes of Atlantic salmon annually, said in its third-quarter report in November that it needed financing of approximately NOK 165m due to expected higher operating costs, financial costs, and increased investments (Capex).

The company has identified debt solutions to cover part of the financing need and consequently a remaining need for equity of approximately NOK 85m, of which NOK 40m has already been committed by some shareholders.

Positive dialogue

“In addition, we are in a positive dialogue with a potential new, high-quality, long-term investor and have received an indication of interest from such an investor to participate with a significant amount in a potential new share issue, and as a result the company will now start dialogues with other existing shareholders and new investors,” the company said in a stock exchange announcement.

“As the company is now considering various financing options, it is reassuring that the business case has strengthened further this year following increased forward prices for Atlantic salmon and increased transport costs to Japan. At the same time, production is well on its way to meeting our volume targets,” said Proximar chief executive Joachim Nielsen.

The company has engaged ABG Sundal Collier and Pareto Securities as financial advisers in the process.

Healthy return

The current Fishpool Forward Price for 2024 and the transport-related costs for Atlantic salmon to Japan correspond to a relevant selling price of approximately NOK ~145 / kg. Proximar expects a production cost of around NOK 59/kg (at EBITDA level).

“Therefore, we expect a healthy return from the start of the first slaughter onwards, with the aim of reaching full utilisation and production volumes of 5,300 tonnes/year in 2027. Proximar’s business case remains solid and is well positioned to benefit from significant cost advantages of local production,” the company stated.

“I am satisfied with the way Proximar is developing step by step towards the first slaughter next year. We look forward to the upcoming transfer of the first fish to our 25,000 m2 food fish department in December and see good performance in our production, where batch 1 has just passed 450 grams,” said Nielsen.

Highlights from the updated company presentation:

  • Proximar's land-based salmon plant in Japan is operational, with nine batches currently in production
  • The fish in batch #1 have an average weight of 450g, and total biomass is approximately 30 tonnes
  • Proximar is several years ahead of its competitors in Japan and will harvest the first fish in Q3 2024
  • 10-year sales and distribution agreement in place with Marubeni Corporation
  • Industrial investors backing the company, including Grieg, Daimyo, Nutreco and Marubeni
  • 8.8 billion (approx. NOK 650 million) syndicated loan led by Mizuho Bank in Japan
  • Remaining financing need of NOK 165 million for increased investments (CAPEX), operating costs/working capital and finance costs.
  • Invested capital to date is NOK 1,560 million

The RAS technology for Proximar is from AquaMaof, which is also expected to supply the equipment for the UK’s first commercial scale salmon RAS planned by Aquacultured Seafood Ltd (ASL) in Grimsby. That facility is also expected to produce around 5,000 tonnes of salmon annually.

ASL uses a video made by Proximar to explain the basics behind its own development, which can be seen below.