Pan Fish Scotland moves to quash job fears – Fishupdate.com

Pan Fish Scotland moves to quash job fears Published:  28 August, 2007

Atle Eide

PAN Fish Scotland (PFS) has moved to quash fears over jobs in the Western Isles, following moves to bring Stornoway-based Outer Hebrides Seafood (OHS) under PFS’s management.

Marine Harvest revealed earlier this month that ownership of OHS would pass to PFS and that the new entity would be offered for sale. That announcement was greeted with dismay because the initial plan, as part of the international mega-merger involving Marine Harvest, Pan Fish and Fjord Seafood, was to sell PFS, and to retain OHS as a free-standing company owned by Marine Harvest. OHS would then be sold off as an independent vertically-integrated salmon production company in the future. There was alarm that the PFS takeover would cut some of the 190 jobs provided by OHS.

A PFS spokesperson said that the outlook for OHS was positive. She said: “OHS will be a subsidiary of PFS. It will become part of a larger company, and it will have guaranteed access to more salmon. There could be some management changes, but the majority of the jobs, raising, harvesting and processing the fish will remain. The management structure of the new entity will be sorted out at a later date.”

Four freshwater sites were transferred from Marine Harvest to OHS earlier this summer, as well as sea cage sites in West Loch Roag, increasing its production capacity and making it the largest producer and processor of salmon in the Western Isles. Marine Harvest was forced by the French competition authorities to divest itself of Pan Fish Scotland, as one of the conditions of the mega-merger being approved in France.

Atle Eide, CEO of Marine Harvest said in the second quarter financial report that OHS and PFS would be sold as a single package. He said: “Marine Harvest is in the process of finding new owners for Pan Fish Scotland. The divestment to other investors might be carried out through a separate listing of the company. It is likely that also Outer Hebrides Seafood and some Marine Harvest sites located in the core farming area of Pan Fish Scotland will be included in the upcoming transaction. In this case the new company, under the name Pan Fish will have a planned production in 2007 of approximately 25,000 tons, with a potential to grow to 35,000 to 37,000 tons over some time. It is the objective to conclude on new shareholders for the company during Q3/Q4.”

Marine Harvest told the Executive that high transport costs prevented them making more substantial investment in the Western Isles. Pan Fish Scotland already had processing facilities at Cairndow in Argyll and it was feared that the Stornoway plant could close, and that processing jobs would be cut.

The PFS spokesperson said: “The two processing plants complement each other. The Stornoway plant smokes and fillets salmon and has perfected the system of getting fresh salmon to market very quickly. The Argyll plant deals only with whole fish and it is close to capacity. Bringing the two companies together makes them stronger through diversification and gives the potential for expansion.”

She added: “PFS is looking for investment from a consortium of Norwegian investors and is hoping to float the company on the Norwegian stock exchange. It will be owned and run as an independent company.”

Last month Marine Harvest decided not to sell Pan Fish Scotland to Norskott Havbruk, the company which owns Scottish Sea Farms, after previously announcing an agreement to sell Pan Fish Scotland for NOK 800m (around £70m). Scottish Sea Farms wanted more in the package than Marine Harvest was prepared to sell at that stage.

Pan Fish Scotland produced around 16,000 tonnes of salmon in 2006. It has 169 employees and 31 sea sites from Loch Eriboll in north-west Sutherland to Loch Fyne in Argyll, as well as a number of freshwater sites, two hatcheries and a processing facility at Cairndow on Loch Fyne. Earlier this year Pan Fish Scotland bought Highland Fish farms for £4.1m, which gave it access to egg production and ongrowing facilities.

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