Phillips Foods has formed a Canadian subsidiary to purchase South Shore Seafoods, which has been operating under the direction of a court-appointed restructuring firm after it defaulted on its debt.
Bloomfield, Prince Edward Island, Canada-based South Shore Seafoods owes over CAD 56 million (USD 41 million, EUR 39 million) to creditors, including CAD 26 million (USD 19.2 million, EUR 18.1 million) in principle in outstanding secured loans and guaranteed obligations to TD Bank. Unable to repay its loans, the company was placed under the direction of Deloitte Restructuring in September 2023.
On 12 January, an asset purchase agreement was reached between Deloitte Restructuring and Phillips Bridge Seafoods, the recently created subsidiary of Phillips Foods, a Baltimore, Maryland, U.S.A.-based seafood company with a focus on crab-based products. The purchase, listed in court documents as confidential, was approved by the court on 24 January.
The court also approved a delay in the case’s proceedings through 30 April 2024 to allow for sufficient time for the deal to be completed.
Brice Phillips, the vice president of sustainability and business development at Phillips Foods, is listed in the documents as the CEO of Phillips Bridge Seafoods. Phillips and South Shore Seafoods Co-Owner David Dalton did not return calls from SeafoodSource requesting comment on the deal.
In January 2023, Phillips told SeafoodSource his company is aiming to offer more value-added products, and he named lobster as a seafood species with “some great value-added applications to it.”
“We've always had a firm commitment to value-added products and we're going to stay firmly committed to that,” he said. "Countrywide, people are having a hard time with staffing. For our foodservice customers, restaurants that five years ago would never even have us in now can't find the staff to prepare their own crabcakes. So now we're getting opportunities on the value-added side that we didn't have before. And so, for us, finding a way to increase our capacity for value-added going into the future is very important. We've always done a great job with value-added products and the majority of our supermarket sales are all value-added products. The same with our club store sales – we do very, very well with that.”
South Shore Seafoods is an umbrella company for Captain Cooke’s Seafood, By the Water Shellfish, South Shore Seafoods International, Can-Am Lobster and Shellfish, Bridge Lobsters Limited, and Arsenault’s Fish Mart. Collectively, the company’s assets include several lobster pens and processing facilities, a value-added products division selling under the South Shore Seafoods brand, export operations to Europe and Asia, a distribution outfit for Canadian and U.S. sales, and a brick-and-mortar seafood market in Wellington, Prince Edward Island, Canada.
Photo courtesy of Costco