Bumble Bee Foods, one of North America’s largest branded, shelf-stable seafood companies, announced Nov. 21 that it has entered into an asset purchase agreement with affiliates of FCF Co. Ltd., which has agreed to acquire the company’s assets for approximately $925 million.

To facilitate the sale and reduce the debt burden caused by recent and significant legal challenges, Bumble Bee has initiated proceedings under chapter 11 of the U.S. Bankruptcy Code in the District of Delaware. Bumble Bee has received new financing commitments from its existing lenders that will provide sufficient liquidity to fund the business through the closing of the sale.

“It’s been a challenging time for our company, but today’s actions allow us to move forward with minimal disruption to our day-to-day operations,” Bumble Bee president and chief executive officer Jan Tharp said. “We have an experienced leadership team in place and plan to transform our business in bold and innovative ways that will build a legacy worthy of our proud 120-year-old history.”

Bumble Bee intends to promptly file a bid procedure and sale motion along with the purchase agreement. FCF will serve as the “stalking horse” purchaser for the sale process. Its bid will be subject to a court-supervised auction process designed to achieve the highest or otherwise best offer for Bumble Bee’s business. Tharp said she anticipates that the transaction will move swiftly and close within 60-90 days.

As part of the sale transaction, Bumble Bee’s Canadian affiliate, Connors Bros. Clover Leaf Seafoods Co., will be initiating proceedings under the Companies' Creditors Arrangement Act (CCAA). As part of the CCAA, Connors Bros. intends to seek approval of the appointment of Alvarez & Marsal Canada Inc. as the monitor to oversee the CCAA proceedings.

“It is our clear intent that all U.S. and Canadian operations continue uninterrupted. Employees will get paid, our customer partners can count on us to continue delivering outstanding brands and services and vendors will be paid in the ordinary course of business,” Tharp said.

Taiwan-based FCF, one of the world’s largest marine products integrated supply chain service provider companies specializing in tuna, has more than 40 years of experience in the trading and marketing of tuna products. The company has established more than 30 subsidiaries, fishing bases and shipping agents throughout the world to handle the service needs of its customers.

Legal woes

Bumble Bee has been plagued by legal woes over the last couple of years, pleading guilty in 2017 to a tuna price-fixing case. According to the U.S. Department of Justice, the company paid a $25 million criminal fine for its role in a conspiracy to fix the prices of shelf-stable tuna fish, such as canned and pouch tuna, sold in the U.S.

The company is also facing three class-action lawsuits that are still pending as well as eight other separate legal claims.

In bankruptcy documents, Bumble Bee said it had spent “tens of millions of dollars” in defense costs. Its debt at the time of the bankruptcy filing totaled $650 million.