‘Very much Tasmanian’: Salmon grower Tassal chief bats away foreign ownership concerns

Tassal’s chief executive has batted away concerns about Canadian aquaculture giant Cooke’s takeover bid and said the Tasmania-based salmon producer’s new foreign owners have “endorsed” the existing management team.

The ASX-listed salmon grower announced on Tuesday that Cooke had succeeded in its fourth acquisition attempt and will acquire 100 per cent of Tassal’s shares for $5.23 a share, or $1.1 billion.

Salmon producer Tassal has released its full-year profits.Credit: AFR

The acquisition follows months of negotiations between the two parties and is Cooke’s fourth proposal after initial offers of $4.67, $4.80 and then $4.85.

Tassal chief executive Mark Ryan said the two companies were a “natural fit”. He said Cooke was seeking to assist Tassal’s growth and “look at some synergies and opportunities that might develop as we go”.

“They’ve been very clear on supporting the management team, and I think that’s a big validation of what we’ve been able to deliver and what we’ve got in terms of our strategic plan going forward,” Ryan said.

“Whether or not they actually ultimately acquire [Tassal], we’ve got a business to run over the next six months that we’ll be incredibly focused on. For us, it is very much business as usual from that perspective, until things change.”

Ryan also outlined a commitment for Tassal, Tasmania’s largest employer, to retain its Tasmanian identity despite being acquired by the Canadian giant.

“The product’s grown here, so it is very much Tasmanian,” he said. “It becomes, we have potentially one shareholder rather than thousands of shareholders. But equally, the actual business itself and the people we employ will predominantly come from Tasmania.”

Ryan, who has been with Tassal for 20 years, intends to stay as managing director and chief executive.

“I love the opportunity to run this company ... I want to run it continuing on. So I’m fully invested in this whole process,” he said. “From my point of view, I’ll definitely be here, I’m looking forward to that. I’m too young to retire.”

In a statement, Cooke chief executive Glenn Cooke said Tassal was an “excellent fit” with “many similarities” between the two companies.

“Our family-owned company is keen to have the opportunity to continue to grow Tassal from the strong base the employees, management and board have created,” Cooke said.

“We have demonstrated acquisition history where Cooke has left operations management in place for continuity. We are highly impressed with the quality of Tassal’s infrastructure, people and culture.”

Cooke said the Canadian company’s “top priority” would be to further boost Tassal’s environmental improvement plans, strengthen supply chains and community relationships, and make “strategic investments” in technology.

Tassal’s shareholders will vote in November to approve the acquisition deal, which the board unanimously supports.

From there, Tassal will be delisted before the calendar year ends.

Cooke previously attempted to acquire Huon Aquaculture but ultimately lost out to Brazilian-owned JBS, a meat and food processor.

The agreement between Cooke and Tassal means that two of Australia’s three largest salmon producers are now owned by foreign companies. The third, Petuna, is 50 per cent owned by New Zealand company Sealord Group.

Tassal on Tuesday also revealed its 2022 financial year results.

Tassal’s statutory net profits after tax rose by 31.9 per cent to $55.4 million for the year ending June 30. Revenue had a similar rise of 32.8 per cent to $788.7 million.

The company also generated record cash profits in the 2022 financial year with free cashflow more than tripling to $95 million in 2022 from $29 million in 2021.

Prawn was a key strength for Tassal, with volumes increasing 70 per cent year-on-year compared with salmon which rose 15 per cent.

Salmon prices, however, rose 13 per cent, sharply higher than the six per cent increase for prawn prices.

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.