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March 6, 2020

Clearwater Seafoods could be sold as strategic review initiated

Canada-based Clearwater Seafoods has taken action which could result in strategic change, it has revealed. 

By Leonie Barrie

Canada-based Clearwater Seafoods has instigated a strategic review that could result in the business getting a new owner.

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The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
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In a statement, the Nova Scotia-based seafood heavyweight said the review was intended to “identify, review and evaluate a broad range of potential strategic alternatives available to it with a view to continuing to enhance shareholder value”.

It has been initiated after the business received “expressions of interest” from several parties.

Clearwater has formed a committee of independent directors to “solicit, consider and evaluate” various strategic alternatives available to the company.

The company, which owns UK-based Macduff Shellfish Group, said its directors had determined it is “timely, prudent and in the best interests of the company and its stakeholders to commence the strategic review in light of the company having recently received several expressions of interest”.

However, Clearwater has stressed selling the business is not its only option.

It said: “Strategic options may include, but are not limited to, a sale of all or a material portion of Clearwater’s assets, either in one transaction or in a series of transactions, the outright sale of Clearwater, a merger or other transaction involving Clearwater and a third party, joint ventures, licensing arrangements, various financing alternatives or other significant transaction.”

The committee overseeing the review has engaged RBC Capital Markets as its financial adviser for the process.

Clearwater said it would not be disclosing developments with respect to the strategic review until its board had approved a specific transaction.

Earlier this week, Clearwater posted its 2019 financial results. The company reported a 4.1% rise in sales to CAD616.2m (US$460.2m). Earnings attributable to shareholders were CAD41.7m, versus a loss of CAD16.2m in 2018.

In January, Clearwater, one of North America’s largest vertically-integrated seafood companies which supplies both the retail and foodservice channels, formed a joint venture with local peer Quin-Sea Fisheries.

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Free Report
img

What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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