In September Gigante revealed that the cost of constructing its new facility had jumped by an extra $18 million.
Norwegian land-based salmon farmer Gigante Salmon has announced its plans to raise an additional NOK 200 million ($18 million) in funds, to cover the escalating costs of building their fish farm in Rodoy, Norway.
New shares of the company will be offered at a set price of NOK 7.2 each, according to a stock exchange announcement issued on Wednesday night.
The company attributed the increase – which brought the total expected expenditure to NOK 645 million ($60 million) – to a general rise in prices across various sectors and modifications to enhance the welfare of the fish.
In a significant development last week, the company managed to alleviate some of the financial strain by securing a long-term lease agreement with Sparebank 1 Finans Nord Norge.
This deal provides up to NOK 100 million ($9.2 million) to help cover the increased construction costs. The upcoming private share sale is expected to account for the remaining deficit.
The process of selling these shares is being managed jointly by SpareBank 1 Markets and SpareBank 1 Nord-Norge Kapitalmarked, and is open to selected investors both in Norway and internationally.
Demonstrating support for the company, Gigante Havbruk, the largest shareholder with over half the ownership, has already committed to buying NOK 100 million ($9.2 million) worth of shares in this private sale.
Although the first release of smolt into the farm is now expected in the final quarter of the year, a slight delay from the initially planned September/October release, the company assures that this won’t impact the overall plan. The first batch of fish is still slated for harvest at the end of 2024.
Despite these financial and construction hiccups, Gigante is optimistic about its future. In the first round of production, they are aiming to produce 3,000 metric tons of salmon and have set their sights on increasing this to 20,000 metric tons by the year 2027.