High Liner Foods, the Canadian seafood processor, has secured the acquisition of Icelandic Group’s operations in the US and Asia.
The US$230.6m deal, announced on Thursday (17 November), will make High Liner the “leading value-added seafood supplier” to the foodservice sector in North America, it said.
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Last month, High Liner announced the two companies were in negotiations over a possible transaction.
“The operation will be a good fit with High Liner’s US operations and allow us to address a larger, consolidated customer base through stronger purchasing power,” High Liner president and CEO Henry Demone said.
The acquisition includes Icelandic’s processing plant in Newport News in Virginia, as well as subsidiaries that operate a processing plant in China and procure product from other Asian countries.
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For the 12 months ending 30 September, Icelandic’s US and Asian operations recorded sales of US$268m and pro forma adjusted EBITDA of around US$29m, High Liner said.
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By GlobalDataAs part of the deal, the company has agreed to a seven-year licensing agreement with Icelandic for the use of the Icelandic Seafood brand in the US, Canada, and Mexico. The company has also set up a “long-term” distribution agreement with Icelandic that will ensure producers in Iceland will “continue to have the same access to the US market as they do today”, it said. The deal will enable High Liner to supply its customers with fillets from Iceland under the Icelandic Seafood brand.
High Liner’s move for Icelandic’s US and Asian operations was not the first time it had shown interest in the business. Earlier this year, High Liner made a EUR340m (US$460.4m) offer for the whole business. At the time, FSI, the consortium of pension funds that owns High Liner, was in talks to sell the company’s European operations to private-equity fund Triton but those discussions broke down. FSI then opted to put the US and Asian businesses on the block but keep the European operations, which supplies retailers like Tesco and Marks and Spencer.
In June, Icelandic sold its operations in France and Germany to a consortium led by Asian seafood processor Pacific Andes.
