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Bumble Bee Foods Completes Going-Concern Sale for $928 Million
- Client News
- January 31, 2020
Paul, Weiss advised Bumble Bee Foods, LLC and its affiliates in the successful going-concern sale of its businesses to its primary tuna supplier, FCF Co. Ltd. and its affiliates (FCF). The $928 million sale, approved on January 24 and closed on January 31, was consummated through coordinated U.S. Chapter 11 and Canadian Companies’ Creditors Arrangement Act (CCAA) proceedings.
Beleaguered by prepetition civil litigation overhang and expenses relating to antitrust allegations dating back to 2015, as well as a $25 million criminal fine resulting from a 2017 plea agreement for price fixing with the U.S. Department of Justice, Bumble Bee began pursuing strategic alternatives in 2019 with the support of its secured lenders. Unable to reach an out-of-court settlement, Bumble Bee conducted an extensive marketing process for the sale of its businesses, which culminated in the filing of U.S. and Canadian restructuring proceedings on November 21, 2019. FCF submitted the “stalking horse” bid, with an asset purchase agreement providing for up to $930.6 million in value, including a $275 million cash component.
The sale, approved by U.S. Bankruptcy Judge Laurie Selber Silverstein in the District of Delaware, preserved employment for almost all of Bumble Bee’s employees, provided for the assumption of almost all of the company’s contracts, kept intact Bumble Bee’s customer and vendor relationships, preserved the company’s existing U.S. and Canadian labor agreements, and provided for a substantial recovery for prepetition secured lenders. Under FCF’s ownership, Bumble Bee will continue as North America’s premium seafood company with a commitment to continued innovation and growth. The Chapter 11 and CCAA cases will now turn to winding down the bankruptcy estates and implementing a global settlement agreement reached with the Creditors Committee in connection with the sale process.
Founded in 1899, Bumble Bee is one of North America’s largest branded shelf-stable seafood providers, offering a full line of canned and pouched tuna, salmon, sardines and specialty seafood products under leading brands in the US and Canada, including Bumble Bee, Brunswick, Sweet Sue, Snow’s, Beach Cliff, Wild Selections and Clover Leaf. FCF, a Taiwanese company, is one of the largest global producers and distributors of seafood products, acting as a broker for fishing vessels contracting with over 500 independent tuna fishing vessels worldwide.
The Paul, Weiss team included restructuring partners Kelley Cornish and Alan Kornberg and counsel Claudia Tobler; corporate partners Kelley Parker and Austin Witt and counsel Scott Grader; litigation partners Kenneth Gallo, Aidan Synnott and William Michael; intellectual property partner Charles Googe; tax partner Brad Okun and counsel Todd Hatcher; employee benefits partner Lawrence Witdorchic and counsel Reuven Falik and Uri Horowitz; real estate partner Salvatore Gogliormella; environmental counsel William O’Brien; and antitrust counsel Marta Kelly.