The Commerce Commission allowed Moana to purchase the inshore fishing business on North Sanford Island
The deal will make Moana New Zealand the largest coastal fisheries company in Aotearoa.
Iwi-owned fishing company Moana New Zealand has been granted a license to buy North Island inshore fishing rights from rival Sanford, making it the largest inshore fishery company in Aotearoa.
The Commerce Commission approved the deal that will see Moana lease the fishing entitlement from Sanford for at least 10 years. Sanford will retain ownership of the stake.
Inshore fisheries are those located within 12 nautical miles of the New Zealand coast.
Under the deal, Moana will catch, process and sell fish using fishing rights, helping it achieve economies of scale at its processing plant in Auckland. For Sanford, the deal represents an opportunity for an unprofitable portion of its business to generate a lower-risk income stream, shifting its focus to higher growth areas.
“Moana is exceptionally well positioned to handle additional catch and processing volumes with a proven track record of success in land-based operations, managing the supply chain of perishable goods, while building facilities developed with growth in mind,” Moana CEO Steve Tarrant said in a statement. . statement.
“This additional capacity provides opportunities for Māori beyond just fishing. It provides scale that will enable investment in innovation and science that align with our values of kaitiakitanga and manaakitanga.”
Tarrant said the deal is subject to one remaining commercial condition, which it and Sanford are working to fulfill immediately after receiving the required regulatory approval.
Sanford’s acting CEO, Craig Ellison, welcomed the Commerce Commission’s approval.
“Our minds are now turning to ensuring that the other condition is met and the details necessary to complete the deal are smoothly implemented,” he said. “This will include looking at the future of some of our employees and some of our onshore processing assets.”
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Sanford, New Zealand’s largest fishing company, has reviewed its unprofitable North Island coastal operations over the past year as it faced rising costs, labor constraints and the impact of Covid-19 and considered the future of its plant in a high-density residential area in Auckland’s CBD.
It considered building a new, modern site in Auckland, but the cost of redeveloping and relocating the plant was prohibitive and would not deliver an acceptable return on investment. I have also considered partnering with another player in the industry or going out of the business altogether.
Under the deal, Moana will pay $11 million annually for the first year of fishing entitlement, up to $13 million over the next five years, with payment thereafter increasing by 1.5% annually.
It is expected to pay an additional $5 million to $8 million for two of Sanford’s North Island-based trawlers, other fishing equipment and a marine farm.
Sanford said more than 100 employees would be affected if the deal goes ahead, and that it would work with Moana to facilitate employment of affected employees where possible.
Moana previously said she needed more people and was interested in speaking to affected employees at Sanford about the possibility of new roles.
Sanford is assessing the future of its Wynyard Quarter processing site in Auckland’s central business district, an area it said has undergone significant change and is now very residential.
Shares in Sanford were unchanged at $3.82 in midday trading on the NZX on Wednesday.