High Liner Foods, Canada, acquired the principal assets and operations of American Pride Seafoods LLC from Seattle-based American Seafoods Group LLC.
American Pride is primarily a value-added frozen seafood foodservice and scallop processing business based in New Bedford, Mass. The acquisition is expected to bolster High Liner Foods' market leadership position in the foodservice segment of the U.S. value-added frozen seafood industry, and also results in the company adding significant U.S.-based scallop processing operations to its business portfolio.
High Liner Foods paid $34.5 million in cash proceeds, subject to closing working capital adjustments, to acquire American Pride's tangible assets, which principally include inventory, plant and equipment located in New Bedford, and excludes accounts receivables of approximately $15.5 million, for a total enterprise value of approximately $50 million. As part of the transaction, the company assumed certain operating leases related to the acquired businesses. High Liner Foods does not expect any material intangible assets will be recorded in its financial statements as a result of the acquisition.
"Our vision is to be the leading frozen seafood supplier in North America, and a key component of High Liner Foods' strategy is profitable growth through acquisitions like American Pride that complement our business and should strengthen our leadership position within the seafood industry," says Henry Demone, chief executive officer of High Liner Foods. "American Pride is well-established in many key market segments and known for offering its customers quality and value. This transaction should create incremental value for our shareholders and bring us one step closer to achieving our vision."
"Our long history with American Pride and its excellent employees made the decision to sell the business a difficult one," says Bernt Bodal, chief executive officer of American Seafoods Group. "However, this sale will allow us to strengthen our position as a producer of premium seafood products from the sustainably-managed fisheries in Alaska and the Pacific Northwest and lead the industry in developing new products and markets from those fisheries. We want to thank the dedicated and talented people at American Pride for all of their contributions to the success of American Seafoods Group. We wish High Liner Foods and our former employees all the best in the future."
High Liner Foods plans to delay the integration of this acquisition into its business and will operate American Pride without any substantial changes to its existing operations through 2014. This will allow High Liner Foods to continue its current efforts focused on fully realizing the synergies related to integrating Icelandic USA, which it acquired in 2011.