£55m deal agreed
Scottish Salmon refinances with Bank of Scotland
It is the first time a salmon farming company has used a Scottish bank to deliver full banking and ancillary services.
The deal, which includes a term loan and asset-based lending (ABL) facilities, will provide the company with flexible access to working capital to help grow sales overseas.
Bank of Scotland will be sole banker for the business which reported a £405,000 loss for 2015 against a £13.6m profit a year earlier as it suffered from competition in overseas markets. It said it was on target to meet growth targets this year.
The Scottish Salmon Company is registered and based in Scotland. It is the only large salmon company managed in Scotland and where all operational decisions are made. It is listed on the Oslo Bors stock exchange.
The company employs more than 480 staff at 60 sites in the west of Scotland and the Hebrides. It is Scotland’s largest independent salmon producer, harvesting in excess of 25,000 tonnes in 2015, and is on track to increase this to around 35,000 tonnes a year by 2018.
Fiona Larkin, finance director at the company, said: “We are a young maturing business with a clear strategy for sustainable growth. We required a day to day banking partner who could offer us the flexibility to support this and understand the unique nature of the salmon farming industry.”
Currently exporting to 25 countries including China, USA, and the Far East as well as more established markets in Europe, the business has invested substantially in its export strategy to grow sales in existing and developing markets.
Last month it launched its exclusive Native Hebridean Scottish Salmon to international customers – a salmon with unique lineage, bred from stock sourced directly from the waters of North Uist.
Craig Anderson, managing director, said: “Bringing our banking requirements to Scotland is an industry first and signals both our intention to grow the business and to continue to develop our position as a leading Scottish food producer here in Scotland. We are proud to be working with the Bank of Scotland and look forward to long term relationship in the food and drink sector with them.
“We have ambitious plans in place to develop harvest volumes to allow us to meet increasing consumer demand and Bank of Scotland’s term loan and asset-based lending facilities are the ideal funding structure to enable these growth plans.”
Andrew Sloan, relationship director, commercial banking, Bank of Scotland said: “The Scottish Salmon Company is an award winning producer and one we are very proud to support.
“It has recorded strong year-on-year growth and the team is focused on building on this success, increasing harvest volumes and expanding the business further. The ABL facilities give the business the confidence to continue its expansion as the funding can be increased as the business grows.”