M&A advisor: ‘Who’s going to be next Cooke?’

More diversified global seafood players like Cooke are needed to bring stability to the industry, said a senior mergers and acquisitions (M&A) advisor during an Undercurrent News webinar on the impact of the coronavirus pandemic on deals.

Ignacio Kleiman, whose Antarctica Advisors is the most prolific M&A advisory firm according to Undercurrent’s latest Seafood Dealmakers 2020 report, said more players like Cooke would make the sector more robust in riding out global crises.

“Who’s going to be the next Cooke? Clearly, in order to be successful in the world of seafood, you have to be sizeable and you have to be diversified by species. You have to be diversified by currency. You have to be diversified by geography,” he said, on the “What COVID-19 Means for Seafood M&A” webinar.

This gives Cooke more “stability of earnings, because of the portfolio diversification embedding the structure of the company”, Kleiman said on the webinar (which you can watch in full below), where the consensus was the pandemic would slow, but not stop, seafood M&A.

There has been “one player that has had the vision to go on and execute on a plan like that”, which is Cooke founder Glenn Cooke, he said. “We probably need four of those, five of those at least, and then the industry as a whole is going to be some more stable and we’re attractive.”

Kleiman’s comments come as Cooke has just announced a deal to merge its five Icicle Seafoods Alaska salmon plants with those of Ocean Beauty Seafoods’ five in a 50/50 joint venture named OBI Seafoods. The other half will be owned by Ocean Beauty’s current shareholders, community development quota group the Bristol Bay Economic Development Corporation (BBEDC) and Howard Klein and a group of other investors.

The deal, a long time in the making, is driven by a need for the medium-sized players in the sector to get bigger to compete with Silver Bay Seafoods and Trident Seafoods, sources told Undercurrent. Icicle’s pollock operations, the factory vessel Gordon Jensen and Northern Victor, a processing ship permanently moored in Dutch Harbor, are not part of the deal. Neither are Ocean Beauty’s smoked salmon and distribution businesses, which Cooke is said to covert. The Ocean Beauty smoked and distribution business will operate under the name OBS Smoked & Distribution and continue to be owned by BBEDC, Klein and the other investors.

This Alaska salmon tie-up is the first deal in a while for Cooke, which started life as a salmon farmer in New Brunswick, Canada, but has grown into a global player with close to CAD 2.5 billion in turnover and assets globally. The company farms salmon on the east coast of Canada, both coasts of the US, as well we the UK and Chile. Cooke has also moved into seabass and seabream farming in Spain, with Culmarex.

Cooke’s most recent aquaculture diversification has been buying shrimp farms in Latin America, with deals for Seajoy Group and Farallon Aquaculture de Nicaragua in early 2019.

In wild catch, Cooke owns a stake of Newfound Resources, an Atlantic Canadian fishing company, then it acquired Wanchese Fish Company in 2015. Wanchese operates fishing vessels in the US and Argentina, being a big player in scallops in the latter. In 2016, Cooke acquired Icicle, the salmon plants of which are now merged with Ocean Beauty. At the end of 2017, Cooke acquired Omega Protein, a firm catching and reducing menhaden into fishmeal and fish oil.

Earlier this year, Cooke was also being linked to a deal for Grupo Cabo Virgenes, anArgentina-based fishing and processing  rm with a plant in Spain. In March 2019,Cooke told Undercurrent he’d acquired a shrimp fishing vessel in Argentina and is looking for more deals in both wild and farmed shrimp.


By Tom Seaman | Undercurrent News