BUMBLE BEE HAS AMBITIOUS PLANS

Interview on Atuna.com

BUMBLE BEE HAS AMBITIOUS PLANS
(May 22, 2003)

Last Monday Conagra sold Bumble Bee Seafoods, Inc. to Centre Partners and the Bumble Bee senior management team. Atuna talked to Bumble Bee CEO Mr. Chris D. Lischewski and asked him the following questions:

How should we consider this deal between ConAgra's and Centre ? Is this a management buy-out financed by venture capital ? Or is it take-over by a private capital investment group, in which also the management took a share ?
It is an investment that has been made by Centre Partners with the active involvement of senior management. Centre Partners will own the majority of the stock in the company although management will own a significant stake. We worked closely with Centre in putting this deal together and we feel they are good partners that will support our growth and expansion

Can you disclose the amount that was paid by Centre ? How will payment take place, in what form or set-up?
We cannot disclose the terms of the deal

Which management members are involved in this " participation"?
All eight members of Bumble Bee's senior management team are involved in the transaction as equity shareholders. Other management will be involved in the form of stock options

What does inspire Centre and the BB management to invest in this extremely competitive and low margin tuna business, which is subject to over-supply and already a long record of very thin margins?
We feel we have tremendous brands with Bumble Bee in the U.S, and Clover Leaf in Canada. These brands, coupled with a low cost processing and sourcing matrix lead us to believe that we can deliver solid financial growth. We have already shown tremendous improvement over the last three years and our cost reduction efforts are not yet completed. Furthermore, we believe that we can achieve additional top and bottom line growth through expansion both inside and outside of the 'can' utilizing the brands that we own

ConAgra's said: ‘This transaction reflects our agenda to alter our portfolio to improve margins and returns. As we have said before, our portfolio changes are part of our overall improvement initiatives, which also include reducing costs and building excellent operating capabilities”.
Why do you believe that you can do better in this new set-up ?
Under ConAgra, Bumble Bee was not seen as a core grocery category and seafood is not a core competency of ConAgra. As such, we were not deemed a growth vehicle and CAG was not going to allow us to pursue the growth strategy that we have developed. Centre is much more aggressive and shares our vision of the future and the growth opportunities that are out there. We have a strong, motivated and experienced management team and working with the Centre, we believe we can continue to successfully and profitably build our business

What is Bumble Bee market share and strengths in the various tuna and seafood segments?
We are about 24% in total tuna, 40% in albacore and 17% in lightmeat. We are also number one in total canned salmon, shrimp, crab and a variety of other canned seafood categories. In Canada, our Clover Leaf brand is the leader in canned tuna and canned salmon. It is also the leader in most specialty canned seafood categories with the exception or sardines where we have only recently entered the market.

In what sense does Bumble Bee distinguish itself from it's competitors StarKist and Chicken of the Sea?
The biggest distinction is our strength in the albacore segment which is the highest quality segment of the canned tuna category. In addition, we are a full line supplier of canned seafood including not only tuna and salmon, but also sardines, shrimp, crab and other specialty canned seafood. Not only do we have a strong brand in the U.S., we also have the leading Clover Leaf brand of canned seafood in Canada.

Where do you see the opportunities for BB within the U.S Tuna business?
We will continue to drive our business through new products that focus on improved quality and innovative packaging. We will also pursue growth in canned and other seafood utilzing our procurement strength and our premium brands.

What will this take-over mean for your processing activities in the U.S, Puerto Rico and Ecuador?
There will be no impact other than normal improvements and changes that we would be embarking on with or without the acquisition. As you know, our business never stands still and we will continously be looking for ways to reduce cost, increase efficiency and improve quality.

Will there be any changes in the way Bumble Bee operates in the U.S markets, in terms of distribution and marketing?
There will be no change in the way we go to market in the U.S. or Canada. We believe we have a very strong sales organization and consider it one of our core strengths. We are fortunate that under ConAgra we were always able to keep our sales organization independent from the rest of ConAgra.

Will Bumble Bee like Star-kist continue to move away from processing and more into purely a marketing and distribution organization?
No. We believe it is important to maintain our roots in processing. While we have gradually moved to a greater emphasis on loins, we believe it critical to retain our canning capability as this allows us to better control quality and product safety. It also enables us to be faster to market as we develop innovative new products.

Are there any plans for expansion or partnerships into the European market?
You never know. We would be interested in Europe if the right opportunity presented itself.

What is your outlook for the next 5 years for the U.S. tuna market both in retail and food- service?
We are actually bullish about prospects for the U.S. canned tuna market. With StarKist now under DelMonte ownership, we believe they will be more focused on growing the canned tuna category. Recently, through our joint participation in the U.S. Tuna Foundation, we have reached agreement with StarKist and Chicken of the Sea to embark on a category growth campaign in the U.S. that will focus on the convenience, health and nutrition of canned tuna. By spending money to educate the consumer on the positive aspects of our products, we believe we can turn a flat category into a growth category. If you look at our product, it is almost the perfect food with nutritional aspects that are superior to any of our protein competiors -- specifically meat and chicken. Coupled with new, higher quality products and innovative packaging, I am cautiously optimistic about a category that has not shown growth in many, many years.

Will there be any level of synergy between BB and the American Seafood group – a leading fishing group- , which is also owned since 2000 by Centre Management?
As you may know, Bumble Bee has enjoyed a solid and growing relationship with American Seafoods over the last several years as we provided the procurement support for ConAgra's Louis Kemp line of surimi. American Seafoods has strategic strengths not only as a fishing company, but also in the retail market where it has developed capabilities in frozen catfish, scallops and other seafood products. We look forward to working with American Seafoods in the future to see if we can develop mutually beneficial opportunities that benefit both of our companies.

Will there be any level of synergy between BB and the American Seafood group – a leading fishing group- , which is also owned since 2000 by Centre Management ?
As you may know, Bumble Bee has enjoyed a solid and growing relationship with American Seafoods over the last several years as we provided the procurement support for ConAgra's Louis Kemp line of surimi. American Seafoods has strategic strengths not only as a fishing company, but also in the retail market where it has developed capabilities in frozen catfish, scallops and other seafood products. We look forward to working with American Seafoods in the future to see if we can develop mutually beneficial opportunities that benefit both of our companies.

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