High Liner Foods Inc., a North American frozen seafood company, entered into a purchase agreement June 6 to acquire the Mrs. Paul’s and Van de Kamp’s brands of frozen breaded and battered fish products from Conagra Brands for $55 million, inclusive of about $36 million in inventory.
The purchase price is subject to a customary inventory adjustment.
“This is a highly strategic and compelling opportunity for High Liner Foods that will serve as a catalyst for further growth in the U.S retail market,” said Paul Jewer, president and CEO of Nova Scotia-based High Liner Foods.
“By taking full ownership of these well established and respected brands, we will capture additional value for our shareholders and ensure a seamless transition for existing customers. We look forward to offering choice and value to an expanded portfolio of customers and consumers in the growing U.S market.”
High Liner Foods currently co-manufactures products for Mrs. Paul’s and Van de Kamp’s brands at its U.S based manufacturing facilities, an average of 25 million pounds annually. The transaction secures the volume associated with the company’s current contract with Conagra, which is due to expire in 2027. It is anticipated to increase High Liner Foods’ annual volume from this business to a total of about 29 million pounds of fish procured, processed and sold in the U.S, aligned with the company’s strategy to continue to diversify its global supply chain.
Van de Kamp’s and Mrs. Paul’s are leading brands in the U.S. frozen breaded and battered seafood category, offering a variety of formats for snacks and meals, including crispy battered fillets, breaded fish for sandwiches and tacos and classic fish sticks.
High Liner Foods intends to use the brands’ conversion metrics and brand equity to drive incremental sales of its diversified portfolio of branded and value-added retail products through an expanded distribution network and a significant national base of new retail customers.
The company will fund the transaction from its current ABL facility. According to High Liner Foods, the transaction is expected to close at the end of June, subject to customary closing conditions, while Conagra Brands reported it will close at the end of July. The deal includes all associated intellectual property and inventory but does not include employees or manufacturing facilities.
“This strategic transaction is one example of the steps we are taking to position High Liner Foods for future growth, leveraging our healthy balance sheet today to secure profitable volume and incremental growth for years to come,” Jewer concluded. “We have a clear line of sight to significant synergies that will strengthen our performance over time through operational efficiencies and incremental sales opportunities.”
Conagra Brands President and CEO Sean Connolly commented on the sale, “This divestiture reflects our continued commitment to reshaping our portfolio and investing where we see the best opportunities for growth and innovation. Van de Kamp’s and Mrs. Paul’s operate largely as a stand-alone seafood business, and this divestiture allows us to further focus our efforts on strengthening our core frozen offerings.”
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