Origin to sell non-core asset

Origin Enterprises has moved to strengthen its focus on its core agri-services business by agreeing to sell its marine proteins interests for €90m-plus.

The Dublin-based group has reached conditional agreement to sell its 50% stake in the Welcon Invest AS marine proteins and oils company to its Norwegian partner, Austevoll Seafoods, for 740m krone. At current exchange rates, that translates to €93m-€95m.

Origin will primarily use the proceeds from the sale to invest further in its core agri-services business.

The disposal — which is subject to a number of conditions, most notably Norwegian Competition Authority clearance — is expected to conclude during the first half of the Irish company’s 2014 financial year, which would suggest a timeframe of between the end of this month and the end of January.

Origin chief executive Tom O’Mahony said the deal is in line with management’s commitment to prioritise capital for the expansion and development of the group’s agri-services division.

“The transaction represents an important streamlining of Origin’s business profile,” he said.

Mr O’Mahony added that the deal marks a good outcome for the Welcon business, saying: “Austevoll’s position and proven track record as a leading integrated pelagic fishery specialist will bring further benefits to Welcon under their full ownership.”

Origin and its Norwegian partner jointly formed Welcon nearly four-and-a-half years ago following the merger of their respective Irish, British, and Norwegian fishmeal and fish oil operations.

Origin generated after-tax profits, from the partnership, of around €8.4m over the three years to last July.

Its share of net assets as of the end of last January, amounted to approximately €68m.

Presuming the Welcon deal is approved, Origin’s last remaining non-core asset will be its Valeo Foods joint venture — following its earlier sale of its stake in Continental Farmers Group. Analysts yesterday suggested this, too, will be sold in time.

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