BoS nets £55m Scottish Salmon deal

logo (1)The Scottish Salmon Company PLC has announced new banking arrangements with Bank of Scotland.

The move marks the first time a salmon farming company has used a Scottish bank to deliver full banking and ancillary services. The £55 million refinancing agreement is seen as a major milestone in the Edinburgh-headquartered salmon producer’s growth strategy.

The deal, which includes a term loan and asset-based lending (ABL) facilities, will provide The Scottish Salmon Company with flexible access to working capital as it continues the implementation of its ambitious strategy to develop the company and grow its share of the export market. It will see Bank of Scotland act as sole bankers for the business.

Employing over 480 staff at 60 sites across the west of Scotland and the Hebrides, The Scottish Salmon Company is Scotland’s largest independent salmon producer, harvesting in excess of 25,000 tonnes in 2015. The company is on track to increase this to around 35,000 tonnes a year by 2018.

Fiona Larkin, finance director at The Scottish Salmon 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 countries 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 at The Scottish Salmon Company, 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 added: “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.

“The Scottish salmon industry exports to over 60 countries worldwide and is a key contributor to our national food and drink trade performance. The Scottish Salmon Company continues to be in a strong position to maximise its share of this growing global market. By welcoming the business as a new customer we look forward to supporting further growth in its established and prospective export markets as it continues to develop operationally at home in Scotland.”

The Scottish Salmon Company recently announced its first quarter results for 2016. Operating revenues were up year on year (Q1 2016: £29.1m, Q1 2015: £27.3m) and harvest volumes increased to 6,741 tonnes (Q1 2015: 6,261 tonnes).

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