LUNENBURG, NS, Dec. 10 – High Liner Foods Incorporated (TSX: HLF; HLF.A), a leading North American processor and marketer of superior quality seafood, announced today that the company has plans to acquire Viking Seafoods, Inc. (Viking), a value-added foodservice company based in Malden, Massachusetts. The transaction is expected to close within the next week, subject to High Liner's completion of its due diligence process, final board approval and finalization of a formal purchase agreement.
The acquisition is expected to substantially increase High Liner Foods' share of the market for broad line value-added seafood products in the U.S. foodservice industry. Fishery Products International (FPI), High Liner Foods' go-to-market arm for the U.S. foodservice industry, is one of the leading suppliers of seafood to the foodservice marketplace.
High Liner expects to pay $31.5 million, subject to working capital adjustments, to acquire the private company, which in 2010 had net sales of approximately $40 million. The purchase price will not include Viking's plant in Malden, Massachusetts, which High Liner expects to lease. High Liner, which expects the acquisition to be accretive to earnings per share in 2011, will finance the acquisition with funds drawn from its existing credit facilities. One time acquisition and financing costs will be expensed in the fourth quarter as required by Canadian GAAP.
"Our vision is to become the leading value-added frozen seafood company in North America. A key component of High Liner's overall growth strategy is to acquire complementary businesses that strengthen our market leadership position. This deal fits perfectly within that plan," said Henry Demone, president and CEO of High Liner Foods, Inc. "Viking is well-established in many key market segments, and known for offering its customers quality and value."
Viking brand products are distributed nationally in the U.S. to customers in the health care, education and commercial and independent restaurant markets.
"We are very proud of the unique value-added products and the customer-first philosophy that the Viking Seafoods name has been associated with since 1956," said Jim Covelluzzi, Chief Executive Officer of Viking Seafoods, Inc. Charles Gulino, President of Viking added, "We have long admired High Liner's U.S. foodservice division FPI and are excited to be joining forces with such a highly regarded and significant player in the market."
Source: High Liner Foods Inc.
