Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


SeaDragon raises $4.1m; signs key refinery agreements

29 January 2014

Australasia’s largest refiner and blender of high-quality fish oils, SeaDragon (NZX:SEA), has received a very strong investor response to its Share Purchase Plan (SPP), raising $4.1m well in excess of its $2.5 million target.

SeaDragon has also executed a Heads of Agreement with Orange Building Group Ltd the prospective landlord of its new Nelson-based fish oil refinery and a contract with Desmet Ballestra for the supply of fish oil refining equipment. The new capital and the agreements ensure the company is in a strong financial position and remains on track for the completion of the refinery in the fourth quarter of this year.

SeaDragon Chairman Dr Doug Wilson said: “The strong investor support for the SPP, which closed on Friday bringing to a conclusion a highly successful three month capital raising programme, represents a significant endorsement of SeaDragon’s management team and our strategy to expand our Omega-3 fish oil refining activities.

“After careful deliberation the SeaDragon Board has resolved to accept all applications for the SPP as it will allow SeaDragon to put in place a capital structure that will see us through our next phase of development. In addition, we wanted to reward the loyalty investors have shown to SeaDragon throughout this process. We are delighted with the outcome.”

The capital raised from the SPP combined with the $2.0 million raised with a placement to eligible investors in November 2013 and the $2.5 million raised from the sale of its stake in Snakk Media[1] will be used to retire debt, provide working capital support and fund the new refined fish oil plant.

SeaDragon launched the SPP just before Christmas, offering all shareholders the opportunity to buy up to $15,000 of shares at 1.6 cents per share, the same price offered to eligible investors who took part in the share placement.

SPP shares will be allotted today (Wednesday 29 January 2014) and holding statements will be despatched on Friday 31 January 2014.

SeaDragon Chief Executive Officer Ross Keeley said: “With key agreements for the refinery now completed we are looking forward to getting to work on the plant, which is the first step towards realising the significant opportunities we see in refining and distributing high-quality New Zealand-sourced Omega-3 fish oils.”

The Heads of Agreement with Orange Building Group Ltd covers the construction of a new purpose-built refinery in Stoke about one kilometre southeast of SeaDragon’s existing Nayland Road site. Orange Building Group Ltd has agreed to fund and construct the new building according to SeaDragon’s specifications. It has also agreed to lease the premises to SeaDragon for an initial term of ten years with two rights of renewal for an additional twelve years, as well as unoccupied surrounding land enabling expansion at a later date.

Meanwhile, the agreement concluded yesterday with Desmet Ballestra, a world leader in engineering and the supply of plant and equipment for the oils, fats and animal feed industries, covers the supply of fish oil refining equipment.

SeaDragon will outfit the new refinery for a total projected cost of around $4 million. This sum includes the cost of the Desmet Ballestra equipment.

When completed, the new plant will have the capacity to produce in excess of 5000 tonnes of refined fish oil and could generate annual sales worth as much as $50 million. The plant will produce oil high in Omega-3, primarily from Hoki, sourced from the clean Southern Ocean fishery. Such oil offers SeaDragon’s customers the opportunity to differentiate their products from the anchovy-based oils which currently represent 83% of world Omega-3 fish oil supply.

“The new site in Stoke offers a number of significant advantages over the Richmond site we had earlier earmarked for development,” Mr Keeley said. “The proposed lease offers better terms and the site offers much better infrastructure, notably better transport connections as well as access to a reticulated potable water and waste water supply. It also ensures minimal disruption for staff due to its proximity to the existing site as well as reducing business complexity.

“Additionally, Orange Building Group Ltd also owns our existing Nayland Road site, where we expect to continue to manufacture our shark liver oil products. The landlord understands the needs of our business including the need, over the longer term, to merge the two sites. Orange Building Group Ltd is an ideal partner for SeaDragon’s next phase of growth.”

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

BusinessDesk: APN's NZME Sees Future In Paywalls, Growth In Digital Sales

APN News & Media has touted a single newsroom concept for its NZME unit in New Zealand, similar to what Germany's Die Welt uses, saying an 'integrated sales proposition' is helping it win market share, including ... More>>

Labour Party: Global Milk Prices Now Lowest In 6 Years

The latest fall in the global dairy price has brought it to the lowest level in six years and shows there must be meaningful action in tomorrow’s Budget to diversify the economy, says Labour’s Finance spokesperson Grant Robertson. “Dairy prices ... More>>

BusinessDesk: NZ Inflation Expectations Creep Higher In June Survey

May 19 (BusinessDesk) - New Zealand businesses lifted their expectations for inflation over the next two years, sapping any immediate pressure on the Reserve Bank to cut interest rates, and prompting the kiwi dollar to jump higher. More>>

BusinessDesk: Lower Fuel Costs Drive Down NZ Producer Input, Output Prices

May 19 - Producer input and output prices fell in the first quarter, mainly reflecting lower fuel costs and weakness in prices of meat and dairy products. More>>

Media: Fairfax Media NZ Announces Senior Editorial Team

Fairfax Media New Zealand has today confirmed its new editorial leadership team, as part of a transformation of its newsrooms aimed at enhancing local and national journalism across digital and print. More>>

Science: Flavonoids Reduce Cold And Cough Risk

Flavonoids reduce cold and cough risk Research from the University of Auckland shows eating flavonoids – found in green tea, apples, blueberries, cocoa, red wine and onions – can significantly reduce the risk of catching colds and coughs. The research, ... More>>


BusinessDesk: RBNZ House Alert Speech The Catalyst For Government Action

Prime Minister John Key all but conceded that pressure from the Reserve Bank of New Zealand for concerted action on rampant Auckland house prices was one of the main catalysts for the government's weekend announcements about tightly ... More>>

BusinessDesk: How To Fall Foul Of The New Housing Tax Rules: Tips From IRD

Just because you rented out your investment property doesn't absolve you from paying tax, says the Inland Revenue Department in a summary of commonly made mistakes by non-professional property investors when it comes to their tax liability.More>>

Legal: Superdiversity Law, Policy And Business Stocktake Announced

Mai Chen, Managing Partner at Chen Palmer New Zealand Public and Employment Law Specialists and Adjunct Professor of Law at the University of Auckland, today announced the establishment ... More>>

Housing: More House Price Gains Expected

House price expectations remain high, with a net 56% of respondents expecting house prices will increase. Fears of higher interest rates are fading, consistent with the RBNZ’s signals this year. Affordability and a lack of houses for ... More>>

TDDA: State-Of-The-Art Drug Testing Laboratory To Open In Auckland

World leading drug testing agencies, The Drug Detection Agency (TDDA) and Omega Laboratories, open New Zealand laboratory More>>

Network: Bigpipe Launches Ultra-Fast Broadband Into Wellington

Bigpipe Launches Ultra-Fast Broadband into Wellington Naked broadband provider Bigpipe has extended its national reach, announcing today, the launch of its unlimited UFB offering into Wellington. The Spark Venture business is giving Wellingtonians the ... More>>

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news