Nueva Pescanova and Cooke would make an ideal match, Nueva Pescanova Global Chief Marketing, Innovation, and Communication Officer Miguel Angel González Ezquerra said at the 2023 Seafood Expo Global.
On 13 April, Abanca entered an agreement to negotiate the sale of an 80 percent stake in Pescanova to the rapidly expanding Canadian seafood conglomerate. The exclusivity agreement places the valuation of the Vigo, Spain-based vertically integrated seafood firm at EUR 800 million (USD 884 million). The agreement requires Pescanova to continue to be headquartered in Vigo.
“First of all, we share the same vision regarding product development and regarding the relevance of aquaculture in the future. Secondly, we are similar we have the same views but we are different regarding geographies and species. They work in salmon, scallops, sea bass, and sea bream, while we work in vannamei, Argentine red shrimp, hake, and cod. And they basically work in North America and Asia, and we have a stronghold in Europe and a little bit of Asia and North America. So we are quite complementary,” González Ezquerra said.
Nueva Pescanova CEO Ignacio González agrees, according to González Ezquerra, who said notification of a final agreement is likely to come within the next month or two.
“He thinks it is going to be a good deal,” Gonzalez Ezquerra reiterated to SeafoodSource. “A big part of it is he expects the company to remain in Vigo and that’s why I think Abanca is also keeping a part of the company, to ensure it remains in Vigo.”
At the Global Sustainable Seafood Galicia Forum in late April, González called Cooke – which beat out Iberconsa and Red Chamber to nab the exclusivity agreement – “the best possible business partner,” according to Expansión. He declined to set a timeline for when the deal will be announced.
“We have had a lot of exchanges of information because, logically, we are a large company with a global footprint and each operation must be known. We have started to know the generality and now we should know each of the operations,” González said. “It will depend on how long it takes them to get to know each of the countries and each of our operations in depth. You have to remember we are not just a fishing company, or an aquaculture company, or a company that produces and sells, so we time to get to know each other well.”
González Ezquerra said he couldn’t get into specifics on the deal, since it is still being negotiated.
“We are in the middle of a process so I don't have any further information to share,” he said.
While the company has not yet announced its 2022 results, Gonzalez Ezquerra acknowledged Nueva Pescanova had an off year. El Confidencial previously reported the company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) fell to EUR 20 million (USD 21.7 million), down from EUR 80 million (USD 86.8 million) in 2021, and its operating profit dropped from EUR 70 million (USD 75.9 million) in 2021 to EUR 40 million (USD 43.4 million) last year.
“It was a difficult year for all the sector and for us because of all the inflation, which has increased the [of] aquafeed and gas for the fleet,” he said. “It was not that great a year and there have been many factors that have been a bit hard for the company to absorb, but it's just one year and I think it doesn't have to be mixed up with what the company can do and the performance that we will have in the next few years.”
Nueva Pescanova is brimming with potential as it continues a shift to value-added products initiated by González when he first took over as CEO in 2016, González Ezquerra said. Aided by the leadership of Pescanova USA President and CEO Chris Maze, Pescanova has expanded distribution of its pollock pasta into Target, Albertson’s, Meijer, and Kroger, and launched other new products like its Shrimp Skillet Meals and Shrimp Skewers. And it has taken over market share in Greece and France, he confirmed, helped by the launch of new frozen peeled shrimp products marinated in a selection of sauces.
“We have managed to launch a lot of different species to the market. I think that's something that we can export to other countries,” he said. “We are launching right now protein pasta in the United States, and its [reception] is beginning to look very good. Even with inflation causing prices to change a lot changing the performance of some of the categories we’re in, our strategy has not changed. It’s something that requires patience. But obviously we have to wait and see what happens with Cooke and what it wants to do. With the species that we can get through that partnership with Cooke and their reach, I think there's going to be a whole world of opportunities for the brand.”
González Ezquerra was especially upbeat about a global expansion of Pescanova’s Christmas campaign, which scored a major sales boost in France over the most-recent holiday season.
“We are trying to expand the knowledge that we have in some of the countries regarding the Christmas campaign. Christmas is filled with plenty of dinners with family with friends, and prawns and shrimp reach a peak of consumption,” he said. “Obviously you have to do the things right – look for the right species, look for the right assortment, and then put some media behind it so that it answers what customers are looking for. But we think as one of the largest shrimp producers in the world and with some of the other places where we have created a strong hold, such as our breaded range, with all our innovation, we can push our advantages.”
According to González Ezquerra, Pescanova’s biggest advantage is its brand name.
“We have a very strong brand, which is not the common thing in the in our sector, which is basically raw material,” he said. “On average, you sell with a little bit more margin when you're selling with branded products rather than when you're selling without branded products. And we think our brand has even more upside and we hope that Cooke feels the same.”
The one thing tarnishing Pescanova’s brand, González Ezquerra said, is the parade of former company executives heading to jail for playing a role in falsifying records and laundering money from corporate accounts. Most recently, former Pescanova President Manuel Fernández de Sousa lost an appeal of a six-year prison sentence he received on 10 February, 2023.
“It's sad to see the company's name there. And obviously we are not responsible or have nothing to do with the former owner and employee … but I think it’s hurting the brand. But anyway, it's what they did and it's what justice has to say. We cannot do anything about it.”
Photo by Cliff White/SeafoodSource
