A Sea Dragon technician cleans fish-oil refining equipment in Richmond, Nelson. Photo supplied.
Nelson fish oil manufacturer Sea Dragon almost doubled its
targeted $2.5 million capital-raising from a shareholder
share-purchase plan, accepting $4.1 million from the
The $4.1 million, combined with $2 million raised from a
private placement last November and $2.5 million raised from
selling its stake in Snakk Media, would be used to pay off
debt, provide working capital and fund a new
multimillion-dollar refined fish oil plant near Nelson, Sea
Dragon chairman Dr Doug Wilson said in a statement yesterday.
''The new capital and the agreements ensure the company is in
a strong financial position and remains on track for the
completion of the refinery in the fourth quarter of this
Shares in Sea Dragon were up slightly after the news, trading
over 2c, having hit a year-high of 4.3c in mid-November.
Craigs Investment Partners broker Peter McIntyre said the
$4.1 million raised would be a significant boost to the
company's expansion plans and the news raised its market
capitalisation to about $37 million.
However, he cautioned that with more than 1 billion shares in
the market, management would have to focus on operations.
It would not be wanting to go back to shareholders in the
near future, which could dilute the share value.
Private company Oak Building Group will fund construction of
the new purpose-built refinery in Stoke, and lease it to Sea
Dragon for 10 years, plus rights of renewal, while Sea Dragon
has come to an agreement with oil engineering specialist
Desmet Ballestra to fit out the building for about $4
At Sea Dragon's existing Nayland Rd site in Richmond, also
owned by Orange Building Group, it will continue to
manufacture shark liver oil products.
Sea Dragon chief executive Ross Keeley said the new Stoke
plant would have the capacity to produce more than 5000
tonnes of refined fish oil annually and could generate sales
up to $50 million.
''The plant will produce oil high in Omega-3, primarily from
hoki, sourced from the clean Southern Ocean fishery,'' Mr
Keeley said. Anchovy-based oils represent 83% of world
Omega-3 fish oil supply.
Sea Dragon said it had inherited 25 million Snakk shares when
it joined the NZX, by means of a reverse takeover of Claridge
Capital in late 2012, selling that stake last week for $2.5
Makes: Australasia's largest refiner and blender of
high-quality, internationally certified concentrated fish
oils and fractions, including Omega-3 oils. Sea Dragon is the
largest refined fish oil producer in Australasia, targeting
5000 tonnes annual production.
Sources: Oils sourced from fish caught in New Zealand
waters, in the Southern Ocean and Pacific and Indian oceans.
More than 20 years' experience processing fish.
For: Majority of oils exported, supplies health
supplement manufacturers around the world. Source: Sea Dragon