Abanca eager to sell Nueva Pescanova stake, as Red Chamber joins Cooke in negotiations
A Coruña, Spain-based Abanca, the owner of vertically integrated seafood firm Nueva Pescanova, is actively seeking a partner in the business, or potentially a sale of the company.
On 26 February, Cooke Inc. was reported to be in negotiations to buy a majority stake in Nueva Pescanova, which is headquartered Redondela, Pontevedra, Spain, but which has operations in 17 countries on five continents and sells its seafood products in more than 80 countries globally.
But Cooke now faces competition from Vernon, California, U.S.A.-based Red Chamber Group, which has entered negotiations with Abanca for a majority stake in Nueva Pescanova, according to a 16 March report from El Confidencial. Abanca is considering the offers as it faces a deadline of a USD 150 million (EUR 140 million) debt that is facing imminent maturation, according to the newspaper.
Nueva Pescanova is not directly commenting on the situation, the company’s vice president of marketing and innovation, Miguel Ángel González, told SeafoodSource in an email.
“Unfortunately I cannot comment the intentions of other companies,” he said. “I can tell you that Abanca (our major shareholder) has been looking to find a new industrial partner for the company, as [Abanca CEO] Escotet has stated several times in the last results presentations. They do so in order to sell part of their more than 97 percent share of the company. However if these companies are interested, or if there is a negotiation between them and Abanca, is something you should ask Red Chamber and Cooke and Abanca, as Nueva Pescanova is not involved in the process.”
A spokesperson for Cooke previously declined a request from SeafoodSource to comment on the situation. A Red Chamber spokesperson could not be reached for comment.
On 17 March, La Voz de Galicia reported Red Chamber, which has estimated annual revenue of USD 2 billion (EUR 1.8 billion), is interested in Nueva Pescanova subsidiary Argenova, which would complement its king crab, hake, and Argentine red shrimp processing operations in Puerto Madryn, Argentina. Argenova operates 16 fishing vessels in Argentina catching 20,000 metric tons of Argentine red shrimp, Patagonian toothfish, and squid, and had USD 125 million (EUR 116 million) in sales in the most-recent fiscal year.
Cooke, on the other hand, has shown particular interest in Nueva Pescanova’s shrimp-farming business, and particularly, subsidiary Camarones de Nicaragua (Camanica), which operates 4,500 hectares of farms in western Nicaragua, as well as a hatchery producing 600 million postlarvae annually, and a plant capable of processing up to 30,000 metric tons of shrimp annually.
Nueva Pescanova had total sales of EUR 1.087 billion (USD 1.16 billion ) in its latest fiscal year, which ended in March 2022, and doubled its earnings before interest, taxes, depreciation, and amortization (EBITDA) to EUR 80 million (USD 85 million), up from EUR 39.5 million (USD 42 million) in 2020. However, La Voz de Galicia reported its totals for the 2022 fiscal year will be “well below” its 2021 result. Using a metric of a 10x multiplier on the company’s EBITDA, La Voz de Galicia estimated a sales price for the entirety of Nueva Pescanova at EUR 800 million (USD 856 million), though it said that multiplier is also affected by the potential future value of its brand and its unique access to limited availability of wild-catch resources globally.
A previous attempt by Abanca to reach a deal with Vigo, Spain-based Grupo Profand, which recorded EUR 800 million (USD 820 million) in sales and EUR 74 million (USD 75.7 million) in EBITDA in 2021, via a partnership with supermarket chain Mercadona, fell through. And a separate negotiation with Vigo, Spain-based Ibérica de Congelados (Iberconsa), which itself was acquired by Platinum Equity in 2019, also fizzled. Iberconsa is currently in negotiations to acquire Mascato, a vertically integrated supplier of fresh and frozen seafood products also based in Vigo. Additionally, Abanca has rejected several offers from investment banks.
Abanca hopes to complete a sale of all or part of Nueva Pescanova by the end of March, according to La Voz de Galicia.
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