Posted March 02, 2017 13:36:01

Photo: Tassal said the plans would help the company achieve an extra 3,000 tonnes of salmon harvested per year. (Supplied: Tassal)

Tasmania's largest salmon producer Tassal has revealed major expansion plans, flagging a $270 million investment in capital expenditure over the next five years.

In a release to the Australian Stock Exchange, Tassal unveiled a range of growth initiatives for the next three to five years.

These include:

• About $53 million to establish operations at Okehampton Bay and oceanic sites at Storm Bay
• $95 million investment in improved net technologies and new feeding barges to improve salmon survival rates and feed conversion.
• $38 million to accelerate growth in fish biomass
• About $16 million to automate production and increase processing capacity.

Tassal said the plans would help the company achieve its target of an extra 3,000 tonnes of salmon harvested per year.

It has requested a trading halt while it announced its plans to the market and raised $100 million capital.

Financial analyst Sam Baker said it was likely Tassal would resume trading on Monday.

"When a company does announce a capital raising they will be halted for at least a couple of days while the institutional component of capital raising is being undertaken," he said.

"As far as the capital raising is concerned, $80 million in the institutional component has been underwritten which means it's definitely going to take place.

"The $20 million retail offer is open to retail shareholders and there's no guarantee that will occur, although given the recent profit result I'd be surprised if retail shareholders didn't participate in the offer.

"This is in addition to $180 million credit facility that was announced a few weeks ago at the first-half profit result."

Mr Baker said the announcement came off the back of a very strong first half profit result for Tassal this year.

"The company is now looking to sell more into higher margin wholesale markets this is a sign of confidence from the company that they're looking to increase production," he said.

Over the past six months Tassal and Tasmania's salmon industry has faced increased scrutiny around its sustainability.

Tassal's share price has been on the rise and is sitting at $4.90, up from $3.73 in November last year.

Topics: business-economics-and-finance, fishing-aquaculture, tas