Fjord, Cermaq, Domstein in fish merger

Norwegian fish farming groups Fjord Seafood, state-controlled Cermaq and Domstein agreed to merge fish farming activities on Wednesday to become the world's number two salmon farmer.

Under a complex deal, the new group would be controlled 60 percent by Cermaq and 40 percent by Fjord with Domstein remaining independent while receiving cash, shares and exchanging some assets with Fjord. Rolf Domstein, proposed as the new chairman, said the new company would be the second largest farmed salmon producer in the world behind Dutch Nutreco, leaping past Norway's PanFish which is current number two.

"The new company will have a 12 percent share of the global salmon farming market and a 40 percent share of the salmon feed market," the companies said in a joint statement.

The Norwegian state, which now owns 80 percent of Cermaq, would be the biggest owner of the new group with Domstein the largest private owner. Domstein now owns 26 percent of Fjord.

Domstein would receive NOK 200 million in cash, NOK 175 million in additional Fjord shares and some fish manufacturing activities in the deal. Synergies are estimated at a "conservative" NOK 150 million a year.

Fjord had a market capitalization of NOK 1.54 billion at the close of the Oslo bourse on Tuesday at NOK 7.67. Domstein's capitalization was NOK 842 million at a close of NOK 16.0. Cermaq is not listed. The Oslo bourse reopens at 0900 GMT.