AgriMarine done in Canada?
It is almost a year ago that the large floating tank filled with Chinook salmon outside Campbell River on Vancouver Island broke apart in a storm, and thousands of fish escaped, leaving the rest to be harvested in an emergency operation and long before reaching their planned marketing size. Heralded as a preferred way to grow farmed salmon by many high-profiled environmental groups in Canada such as the David Suzuki Foundation and the Living Oceans Society, the 3,000 m³ solid wall containment structure cracked open, and with no containment net to keep the fish from escaping, one of the main arguments for the use of such technology failed.
In March last year, after removing the remnants of the original tank, the company announced that “Subsequent tanks which are currently being manufactured have been redesigned and will be installed on schedule, including the upgraded pilot tank”. But there are no signs of anything having happened at the site except the removal of the old, broken tank. Two new 24 m diameter tanks- these ones coming from a manufacturer in Washington State instead of China, where the original tank was built, are now apparently heading to Norway, where according to a company release, AgriMarine Industries “has incorporated AgriMarine Norway AS (“AgriNor”), together with two arm’s length parties, to serve as a vehicle for the licensing of its technology, supply of proprietary rearing tanks and know-how throughout salmon-producing countries in Northern Europe. AgriMarine holds a 50% interest in AgriNor and has representation on the board of directors pursuant to a shareholders agreement”. The two “arm’s length parties” were stated to be smolt producer Smøla Klekkeri og Settefisk AS and fish farming producer Lingalaks AS.
According to public records in Norway, AgriMarine Norway AS changed its name to Akvatech AS in November last year, with the Toronto, Canada-based Leon George Raubenheimer as Chairman of the Board, and Canadian Sean Wilton and the Norwegians Geir Spiten and Geir Lislerud as additional Board members. Mr. Spiten is also listed as the General Manager (“Daglig leder”). In an announcement subsequent to its latest financial statements issued for the third quarter of 2012, AgriMarine states that;
“the Company announced the execution of a binding letter agreement (the “Agreement”) with Akvatech AS (“Akvatech”), a Norwegian Private Equity Group, to advance the adoption of the Company’s closed containment fish rearing technology (the AgriMarine System™) in Norway, the world’s largest salmon producing nation, and in other countries. The Agreement contemplates the execution of a series of definitive agreements (collectively, the “Transaction”), the commercial terms of which include:
a) A secured loan from Akvatech to the Company’s subsidiary AgriMarine Industries Inc. (“Industries”) in the amount of CAD $2.5 Million(~€ 1.9 million). The loan will be used strictly for the purpose of retiring existing secured debt.
b) Purchase of the Company’s IP rights and know-how within certain Northern European countries, including Norway
c) Technology and sales licenses to certain countries in Southern Europe, Middle East/Mediterranean region, and South America
d) Sale of two (2) 24m AgriMarine System™ marine tanks for use at a demonstration project in Norway
e) Development and patent protection of a 30m tank design with capacity of 5,500 cubic meters
Pursuant to the Transaction, Industries will enter into an IP and Licensing Agreement, under which Akvatech shall purchase from Industries the right, title and interest in the AgriMarine System™ fish-rearing technology for use in Norway and certain Northern European countries for an aggregate purchase price of CAD$1.5 Million(~€ 1.14 million). In connection with the Transaction, Akvatech will arrange for the sale of two (2) 24m AgriMarine System™ Version 2 marine tanks manufactured by Janicki Industries Inc. for use at a demonstration project in Norway. This marks the first sale of AgriMarine’s technology and establishes the Company as a supplier of closed containment technology. The demonstration project is expected to be jointly financed by a consortium of industry players and salmon farmers, as well as Innovation Norway, the Norwegian Government’s innovation and development arm”.
AgriMarine has posted a net average loss of over CAD$ 1 million (~€ 760,000) in each quarter since December, 2010 and posted a deficit of CAD$ 27,262,000 (~€ 20.7 million) at the end of September, 2012, at which time the Canadian government had committed over CAD$ 6 million (~€ 4.6 million) to AgriMarine. In its latest outlook, AgriMarine’s leaders state that “Management is very optimistic about AgriMarine’s prospects over the coming years. The opportunities in front of the Company are significant and attainable. While the full impact of some of the organizational and commercial changes that have recently been made will take time given the lengthy sales cycles that exist in the target markets, management is confident that the Company will demonstrate definitive commercial progress in 2013 and beyond”.
