Friday, September 26, 2008

Connors Bros. sell itself to private equity


C'mon up to Jim Flaherty's Great Canadian Giveaway Sale. Everything Must Go! - CAITI ad, April 4, 2007

"Private Equity found a very difficult environment for about a year and a half with the Income Trust market. The Income Trust market bid up all sorts of properties and it was very difficult for private equity to compete. With the change in the tax laws coming down the pike, opportunities are out there again and we are seeing a lot of deals. The environment has now turned quite good, not particularly good for Income Trusts, but good for Private Equity."
Richard Schmeelk CAI Private Equity, New York, Sept 25, 2007

"It's the law now" Jim Flaherty, Sept 2, 2008

Connors Bros. canned-fish trust units jump on news of private equity takeover

TORONTO — Connors Bros. Income Fund units (TSX:CBF.UN) gained more than 30 per cent Friday - rising to near their level a year ago - after an American private equity group struck a deal to take over the fish-canning trust.

Centre Partners Management LLC, with offices in Manhattan and Los Angeles, has signed a deal to buy the Connors Bros. businesses for $8.50 per unit, a total of $437.5 million.

Connors Bros. units, which had closed at $6.23 Thursday before the agreement was announced, rose $2.02 to $8.25 in morning trading.

Units in the trust, whose brands include Bumble Bee, Clover Leaf and Brunswick, traded as low as $4.55 in March after tumbling from the $11 level in mid-2007 amid a botulism food-poisoning recall at its Castleberry's canned-meat subsidiary in the U.S.

Connors Bros. sold Castleberry's last week to Hanover Foods for an undisclosed price.

The deal with Centre Partners, subject to unitholder approval, allows Connors Bros. 45 days to seek a better offer.

Connors Bros. Income Fund Announces Sale of Business