Mega 340m euro bid for Icelandic Group in offing

by ww.fishupdate.com - 06/01/2011

"A MEGA fish takeover deal involving two of Britain’s largest seafood companies could be in the offing."

The Canadian seafood company High Liner Foods has made an unsolicited bid, thought to be worth around 340 million euros in total (£290-million sterling) for the Icelandic Group.

The group portfolio includes Coldwater Seafoods and Seachill, both based in Grimsby and which together employ over 1,200 people.

The offer by the Nova Scotia frozen seafood company includes 170 million euros for the Icelandic Group itself and the assumption of 170 million euros to cover corporate debt. However, there are other bids in the wings including one from a German private equity company. Icelandic, which appointed a new board of directors before Christmas, has said that in view of the talks with the private equity firm, it would not start any other negotiations until the end of this week.

The Icelandic Group constitutes an international network of independent companies, each operating in its own market area in the production and sale of seafood products. In the United States, United Kingdom, France and Germany the Group operates processing plants for value added products but in addition there are the sales and marketing companies selling various seafood products.

The sales and marketing companies are located in the United States, United Kingdom, France, Spain and Japan. In addition to these market-oriented companies, there are other companies responsible for procurement of supplies and services; they are located in Iceland, Norway and China. Icelandic Group is also involved in primary processing of raw material through the operation of several processing plants in Iceland, China and Thailand.

High Liner is a company with growth on its agenda. Last month it said it planned to buy Massachusetts-based Viking Seafoods Inc for $31.5 million to increase its market share in the US food service industry and the acquisition of the Icelandic Group, which includes Icelandic USA based at Newport News in Virginia would greatly strengthen its US base. It plans to finance the acquisition through a combination of its existing asset-based working capital facility, new long-term debt and equity.

It is not clear yet whether High Liner would want to keep the European operations which are in Iceland, France and Germany as well as the UK. Both Coldwater and Seachill are highly successful businesses supplying chilled fish and fish products to major retailers such as Tesco and Marks & Spencer. Most of the M&S chilled (and some frozen) fish dishes are made by Coldwater in Grimsby.

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