Thai Union Group Pcl, producer of “Chicken of the Sea” canned tuna and other seafood products, is planning at least two overseas acquisitions this year to boost revenue by about $500 million, following a failed bid for the rival Bumble Bee Foods LLC
The Samutsakorn-based company is considering purchases of seafood producers in Europe and developing countries that have strong brands, Chief Financial Officer Joerg Ayrle said in an interview. It will also buy out shares in some subsidiaries from minority shareholders to bolster revenue growth, he said.
Thai Union is seeking investments outside the US, its biggest market, to achieve its target of almost doubling revenue to $8 billion in 2020, after the company scrapped its planned acquisition of Bumble Bee Foods in December when the US Justice Department raised concerns that the combination would harm competition in the retail tuna market.
â€œThe company has excellent cash flows and strong balance sheet, which provides firepower for overseas acquisitions,â€ Ayrle said in Bangkok.
â€œEurope has a very good opportunity as we still have no strong market in eastern Europe and Turkey. The weak euro also makes the valuations very attractive.â€
The Thai baht has climbed 2.2 percent against the euro in the past two months,and advanced 2.4 percent against the US dollar. Shares of Thai Union have rallied 17 percent this year, outpacing a 8.4 percent gain for the benchmark SET Index. The stock slumped 24 percent in 2015.â€œThai Union was inevitably forced to look at some medium-sized acquisitions after the large deal with Bumble Bee was scrapped,â€ Naree Apisawaittkan, an analyst at Phillip Securities (Thailand) Co. in Bangkok, said through the phone.