Phillips Foods, a US seafood supplier to retail and the out-of-home-channel, is set to acquire the assets of insolvent peer South Shore Seafoods in Canada.
Family-owned Phillips Foods, based in Hoopers Island, Maryland, has struck a deal for an undisclosed sum through an especially established company Phillips Bridge Seafood, according to the restructuring unit of Deloitte.
Deloitte was appointed as monitor in September by the Court of King’s Bench of New Brunswick after creditor Toronto-Dominion Bank requested a so-called stay-of-proceedings against South Shore Seafoods and its subsidiaries for unpaid debt and default.
The financial advisory and accounting firm was tasked with restructuring South Shore Seafoods, based in Bloomfield, Prince Edward Island, or to find a buyer for the business, which materialised in January.
South Shore Seafoods supplied seafood, predominately lobster, under its own brand name. Its subsidiaries, which are part of the deal struck by Phillips Foods, include Captain Cooke’s Seafood; By the Water Shellfish; Can-Am Lobster and Shellfish; Bridge Lobsters; and South Shore Seafoods International, according to Deloitte documents.
“The purchaser is a newly-formed entity within the Phillips Foods group of companies, a privately-owned participant in the global seafood industry focusing primarily on the production of crab-based products,” Deloitte said.
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“Since its founding in 1914, the purchaser has expanded its originally United States-based operations to include processing facilities in Asia and Mexico. In addition to processing, the purchaser also operates several restaurants across the United States.”
Phillips Foods’ portfolio features crab meat and crab cakes, appetisers such as fried calamari, soups and dips, and seafood empanadas. The products are manufactured and supplied under its namesake brand.
At the time of writing, Phillips Foods had not responded to Just Food’s request for comment for more details on its factory and distribution operations, and those of South Shore Seafoods.
The notice of approval for the sale of South Shore Seafoods and its subsidiaries was issued by Deloitte at the end of last month under a so-called asset purchase agreement (APA), with the purchase price kept confidential. It is unclear when the deal is set to be officially rubber stamped.
The transaction for South Shore Seafoods includes “all or substantially all of the property, assets and undertakings of the debtors”, according to the Deloitte document, but excludes inventory and accounts receivable.
“The APA contemplates the purchaser making an offer of employment to employees it elects to hire on terms substantially similar to those existing as of the closing date,” the advisory firm said.