Thai Union nets MW Brands, John West

By

Steven Hedlund

Published on
July 27, 2010

Thai Union Frozen Products on Tuesday confirmed that it acquired MW Brands and its iconic John West canned-fish brand from Trilantic Capital Partners. The deal is valued at approximately THB 28.5 billion (USD 883 million, EUR 680 million).

Thailand’s largest canned- and frozen-seafood producer outbid canned-tuna maker Bolton Group and private equity firms such as Blackstone Group and Permira Advisers for the French canned-seafood producer, whose brands also include Petit Navire, Hyacinthe Parmentier and Mareblu.

Thai Union will add four processing plants in France, Portugal, Seychelles and Ghana to its existing five in Thailand, Indonesia, Vietnam and the United States. Its fishing fleet will grow from four to nine vessels, improving its vertical integration and access to raw material. The company’s tuna-processing capacity will now total 500,000 metric tons of whole round fish, making it one of the world’s largest canned-tuna producers.

The acquisition will increase Europe’s contribution to Thai Union’s total sales from 11 percent to more than one-third. MW Brands is market leader in France, the United Kingdom, Ireland, the Netherlands and Italy. Thai Union owns the Chicken of the Sea canned-tuna brand in the United States.

“MW Brands represents a transformational opportunity for [Thai Union] to consolidate its strength in the global ambient seafood market. In addition, we believe the combination of these two highly complementary businesses will unlock synergies and create a leading global seafood company with broader sources of supply and end-markets,” said Thai Union President Thiraphong Chansiri in a prepared statement. “In addition to diversification of our end-market and production bases, [MW brands’] strong European footprint will also provide us with further business opportunities in the future through a strong customer base, distribution and brand leadership.”

“We believe that [Thai Union] represents an excellent buyer of the business, and the combined company will be able to generate important synergies through procurement, new product development and global sales,” added Trilantic partner Joe Cohen.

Trilantic, a New York-based private equity firm once run by the now defunct Lehman Brothers Holdings, purchased MW Brands from HJ Heinz for EUR 425 million in 2006. MW Brands generated sales of EUR 448 million in the fiscal year ending 31 March.

According to a Dow Jones report, Thai Union will fund the acquisition through EUR 340 million in loans from international banks and another EUR 357.5 million from Thai banks. It will also issue up to EUR 60 million in convertible bonds.

Subject to shareholders’ approval and a federal antitrust review, the transaction is expected to be completed by the end of November.

Thai Union recorded sales of THB 68.9 billion and a net profit of THB 3.3 billion last year.

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