Will The Mermaid Get A New Or Second Partner?

With TUF indicating that a part Chicken of the Sea (COS) sell-off may be the route it takes to help facilitate its planned purchase of Bumble Bee (BB), many in the industry are left curious about how the sale may look. Will the mermaid get a new or additional partner? Or will TUF choose not to buy BB after all, staying loyal to its blonde mascot?

If a chunk of COS does head for the auction block, which part of the firm would be sold off and who might be keen to get their hands on it?

Several sources have confirmed to atuna.com that there is a strong possibility that TUF will put its entire canned tuna segment of COS on the market, and continue only the non-tuna lines under the brand.

Considering that Chicken of the Sea holds around a 10 percent US albacore market share, a high value product, the brand’s tuna segment could attract a range of bidders.

Just as atuna.com speculated when the news of BB for sale first hit, the Bolton Group has been said by sources to be a likely candidate for the buy. Bolton is a 40 percent shareholder in Tri Marine International, the world’s largest trader in tuna raw material, and could be keen to get its hands on COS to break into the US consumer market.

Chicken of the Sea may also gain interest from other non-tuna industry investors.

While Thai Union says the aim of the prospective sale is a potential way to create extra funds to finance its BB buy, money raised from the sell-off may be disappointing. Sources have indicated that the profitability of COS’ tuna activity is not very exciting.

Just today, in light of Thai Union’s indication that part of Chicken of the Sea could go for sale, analysts in Thailand question whether the TUF BB buy will even go ahead.

SCB Securities writes: “We believe that the acquisition of Bumble Bee may be delayed or cancelled, so we exclude Bumble Bee from our earnings forecast in 2015-2016.”

The analysts explain that the deal is currently under the anti-trust law investigation, and the packaged seafood industry in the US is currently under DOJ investigation. While the two cases are not directly related, the latter could take two or three years to finalize.