LUNENBURG, NS, Oct. 1, 2013 /CNW/ - High Liner Foods acquires value-added frozen seafood and scallop
processing businesses (all figures are in U.S. dollars ("USD") unless
otherwise noted) --
High Liner Foods Incorporated (TSX: HLF) ("High Liner Foods" or "the
Company"), the leading North American value-added frozen seafood
company, announced today it has acquired the principal assets and
operations of American Pride Seafoods LLC ("American Pride") from
Seattle-based American Seafoods Group LLC ("American Seafoods Group").
American Pride is primarily a value-added frozen seafood foodservice and
scallop processing business based in New Bedford, MA. 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," said Henry Demone, CEO 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."
American Pride's branded and private label products are primarily
distributed in the U.S. to foodservice customers in the commercial and
independent restaurant, health care and education markets, as well as
to some export and U.S. retail markets.
"Our long history with American Pride and its excellent employees made
the decision to sell the business a difficult one," said 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."
American Pride's revenues were approximately $190 million in 2012. High
Liner Foods expects the acquisition to be modestly accretive to
earnings in 2014, after considering the impact of incremental interest
costs related to financing the acquisition, and excluding the impact of
any integration costs. One-time costs associated with the acquisition
will be expensed in the current period and the acquisition will be
financed with existing credit facilities.
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 Q4 2011. As a result, realization of most of the synergies expected
from integrating this acquisition into High Liner Foods' business are
anticipated to occur in 2015. While the operating margins of American
Pride have traditionally been lower than those of High Liner Foods, the
Company expects these margins will improve to levels closer to High
Liner Foods' existing operating margins once American Pride is fully
integrated and expected synergies from the transaction are realized.
RBC Capital Markets acted as financial advisor to High Liner Foods.
Moelis & Company LLC acted as financial advisor to American Seafoods
About High Liner Foods
High Liner Foods is the leading North American processor and marketer of
value-added frozen seafood. High Liner Foods' retail branded products
are sold throughout the United States, Canada and Mexico under the High Liner, Fisher Boy, Mirabel and Sea Cuisine labels, and are available in most grocery and club stores. The Company
also sells branded products under the High Liner, Icelandic Seafood, FPI, Viking, Mirabel and Samband of Iceland labels to restaurants and institutions, and is the major supplier of
private label value-added frozen seafood products to North American
food retailers and food service distributors. High Liner Foods is a
publicly traded Canadian company, trading under the symbol HLF on the
Toronto Stock Exchange.
About American Seafoods Group
American Seafoods Group, a private company located in Seattle,
Washington, is a leader in the harvesting, at-sea processing and supply
of quality seafood. Through its operating companies, American Seafoods
Group harvests, processes, distributes and markets a diverse range of
fillet, surimi, roe, and block product offerings from sustainably
managed fisheries in U.S. waters off Alaska and the Pacific Northwest
and also develops innovative new products from sustainable fisheries
resources for human and animal nutrition, cosmetic, and other
industrial applications. Fish are harvested aboard the Company's six
state-of-the-art catcher processors, and marketed and distributed
domestically to customers in the U.S., and internationally to customers
in Asia and Europe.
This document contains forward-looking statements. Forward-looking
statements can generally be identified by the use of the conditional
tense, the words "expect", "would", "plan", "anticipates" and
"continue" or the negative of these terms or variations of them or
words and expressions of similar nature. Specific forward-looking
statements in this document include, but are not limited to
expectations with respect to: High Liner Foods becoming the leading
frozen seafood supplier in North America; increasing value to
shareholders; the acquisition being accretive to earnings; achieving
synergies and the timing of any synergies; and improvements in
margins. These statements are based on a number of factors and
assumptions, including: our ability to integrate the acquisition into
our operations; High Liner Foods' share of the market for broad line
value-added seafood products in the U.S. foodservice industry, which
assumes no material customer losses and may be impacted by industry
competition, market forces and the state of the economy; whether any
acquisition will be accretive, which may be impacted by business
integration risks, including our ability to integrate the acquisition
into our operations, achieving the expected synergies, future raw
material costs, anticipated financial performance, market forces and
the state of the economy; and whether further acquisitions occur, which
may be impacted by availability of suitable targets, market conditions
and the state of the economy.
These statements are based on a number of additional factors and
assumptions including, but not limited to: availability, demand and
prices of raw materials, energy and supplies; the condition of the
Canadian and U.S. economies; product pricing; foreign exchange rates,
especially the rate of exchange of the Canadian dollar to the U.S.
dollar; our ability to attract and retain customers; our operating
costs; interest rates; and continued access to capital. The statements
are not a guarantee of future performance. By their nature,
forward-looking statements involve uncertainties and risks that the
forecasts and targets will not be achieved. Readers are cautioned not
to place undue reliance on forward-looking statements, as actual
results may differ materially from those expressed in such
forward-looking statements. We include in publicly available documents
filed from time to time with securities commissions and the Toronto
Stock Exchange, a discussion of the risk factors that can cause
anticipated outcomes to differ from actual outcomes. Except as
required under applicable securities legislation, we do not undertake
to update forward-looking statements, whether written or oral, that may
be made from time to time by us or on our behalf, whether as a result
of new information, future events or otherwise.
For further information about the Company, please visit our website at www.highlinerfoods.com or send an e-mail to firstname.lastname@example.org.
SOURCE: High Liner Foods Incorporated
For further information:
Heather Keeler-Hurshman, CA
Director of Investor Relations
High Liner Foods
Tel: (902) 421-7100