Oceana Group Limited - Cautionary Announcement
Release Date: 13/02/2018 15:00:00 Code(s): OCE
Oceana Group Limited
Incorporated in the Republic of South Africa
(Registration number 1939/001730/06)
JSE Share: OCE
NSX Share Code: OCG
ISIN Number: ZAE000025284
("Oceana" or "the Company")
In July 2015, Oceana concluded the acquisition of 100% of Daybrook Fisheries Inc. (“Daybrook
Fisheries”), a United States ("U.S.") based fishmeal and fish oil processing operation, as well
as an indirect 25% interest in Westbank Fishing LLC (“Westbank”), which operates the vessels
that supply fish to Daybrook Fisheries’ processing plant.
The U.S. American Fisheries Act (“AFA”), requires qualifying fishing vessels in the U.S. to be
owned and controlled by U.S. citizens, among other things. To comply with this requirement,
the remaining 75% interest in Westbank (“the Westbank Interest”) is held by Westbank Fishing
Partners LLC (“WFP”), a qualifying U.S. citizen.
In November 2016 WFP notified Daybrook Fisheries of the exercise of its put option (“the Put
Option”) over its 75% Westbank Interest. As a result of neither Oceana nor any of its local or
foreign subsidiaries being able to acquire the Westbank Interest, due to the AFA qualifying
requirements, the board of directors of Oceana ("the Board") embarked on a bidding process
to identify an appropriate U.S. citizen who could acquire the Westbank Interest.
The Board considered it prudent to form an independent sub-committee comprising only non-
executive members (“the Independent Committee”), with a mandate to seek and evaluate offers
for the Westbank Interest. The Standard Bank of South Africa Limited was appointed to manage
the process for the Board and, in addition, provide advice and guidance to the Independent
Francois Kuttel, Oceana’s Chief Executive Officer (“CEO”), had indicated that he would be
interested in acquiring the Westbank Interest. Mr Kuttel is a U.S. citizen and, prior to his tenure
at Oceana, he operated and managed a fleet of vessels for ten years in an Alaskan fishing
The Independent Committee considered it important that a robust and transparent process was
followed in which proper and careful consideration was given to all the bids received. Stringent
governance measures were put in place given that Mr Kuttel is a director of Oceana and
deemed a related party in terms of the Listings Requirements of the JSE Limited.
The key evaluation criteria applied by the Independent Committee were U.S. citizenship,
commercial attractiveness of the proposed transaction, longevity of any new structure
proposed, the bidder's ability to drive innovation and expertise in and knowledge of the industry.
After thorough deliberation the Independent Committee identified Mr Kuttel’s proposal as being
the most attractive to Oceana and Daybrook Fisheries.
2. Resignation of the CEO
As the discussions between the Company and Mr Kuttel in relation to the Westbank Interest
will now progress to the negotiation of legal agreements, Mr Kuttel has taken the decision to
tender his resignation as a director and CEO of Oceana with immediate effect.
The Board will identify a suitable replacement for the position of CEO. For the time being, the
Board has appointed Mr Rodney Gerald Nicol as interim CEO, effective 1 March 2018. Mr Nicol
served as an executive director on the Oceana board for 22 years until his early retirement in
3. Approval by the Board and Oceana shareholders in general meeting
It is anticipated that any legal agreements to be concluded between Mr Kuttel, Daybrook
Fisheries and Westbank in respect of the Westbank Interest will be made subject to the
approval of the Board, as well as Oceana's shareholders in general meeting by way of an
4. Cautionary announcement
In view of the planned negotiations outlined above, shareholders are advised to exercise
caution when trading in their Oceana shares until a further announcement in this regard is
13 February 2018
Investment Bank and Sponsor
The Standard Bank of South Africa Limited
South African Legal Counsel
United States Legal Counsel
K&L Gates LLP
Kean Miller LLP
Old Mutual Investment Services (Namibia) Proprietary Limited
Date: 13/02/2018 03:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Email this JSE Sens Item to a Friend.