Thai Union Group Public Company Limited (TU) announced on December 4 that it has reached an agreement with Lion Capital to mutually terminate the planned acquisition of Bumble Bee Seafoods. The termination of the share purchase agreement is effective immediately.
The Bangkok, Thailand-headquartered company had been trying to acquire San Diego, California-based Bumble Bee since December 19, 2014. Over the course of almost 12 months, both Thai Union and Lion Capital have vigorously advocated the merits of the deal to the US Department of Justice, which has been engaged in an ongoing antitrust investigation into the packaged seafood industry involving Thai Union subsidiary Tri-Union Seafoods, which operates Chicken of the Sea, the third-largest tuna brand sold in the United States.
Thiraphong Chansiri, president and ceo of Thai Union, commented: “We have put a lot of effort to get this deal approved. However, we also recognize that the clearance is now unlikely due to a higher level of complexity in the process. We have decided to focus our energy on our existing business. Thai Union remains committed to the North American seafood market.”
Just last week, Thai Union was prepared to sell its Chicken of the Sea tuna business in the United States if the US Justice Department would allow it to conclude the proposed $1.51 billion Bumble Bee Seafoods acquisition.
“We’re now preparing a plan to sell Chicken of the Sea. We are in talks with potential buyers and expect to sell it immediately if the Justice Department gives the nod for us to buy Bumble Bee,” said the Thiraphong at the time.
Chicken of the Sea has a market share in the United States of approximately 17%, while Bumble Bee’s share is about 25%. Selling Chicken of the Sea would avoid infringing upon American antitrust rules, which prohibit mergers and acquisitions that allow a single company to dominate the US market.
Even with termination of the Bumble Bee deal, Thiraphong made it clear that the company remains on track to achieve $8 billion is annual sales by 2020.
