Seafood Connection buys frozen food arm of Netherlands-based Anova

19 November 2018 Consultancy.eu

Seafood Connection, the European business of the world's largest seafood company by sales, has acquired the frozen food operation of Netherlands-based Anova Seafood. The move is part of Anova's strategy to refocus its efforts to the international distribution of fresh and premium seafood.

“We see a lot potential by adding Anova’s product portfolio to our current business and it will strengthen our position in sourcing, processing and sales of seafood products," said Jan Kaptijn, the CEO of Seafood Connection, in a statement. Seafood Connection is since 2013 a subsidiary of Japan's Maruha Nichiro, a global leader in the seafood industry. The multinational supplies among others wild-caught salmon, Atlantic salmon, octopus, king crab, squid, tuna, shrimp and Patagonian toothfish to clients around the world.

Seafood Connection is based in Urk, one of the traditional fishing towns in the Netherlands. The company imports, exports and distributes frozen fish products to retailers, wholesalers, food processors and distributors.

For Anova Seafood, which is based in ’s-Hertogenbosch, the deal is the final step of a strategic reorientation the company has gone through in recent months. "We see a lot of potential for Anova to strengthen and expand its position in the fresh and chilled seafood segment, and therefore we have redirected our strategic focus towards the fresh and chilled seafood segment. We aim to further specialise in the next couple of years,” explained Constant Mulder, one of the two owners of the company, together with Willem Huisman. The two business partners did not disclose financial details of the deal, which will take effect on 1 January, 2019.

Seafood Connection buys frozen food operation of Netherlands-based Anova

During the sale process, Mulder and Huisman were advised by Squarefield, an M&A boutique based in Amsterdam. The merger & acquisition consultancy specialises in food & beverage deal-making – earlier this year, the firm was also part of the deal teams for the Vaessen-Schoemaker – Agersol (buy-side), Oerlemans Foods – Virto Group (sell-side) and Klaas Puul – Foppen Eel and Salmon (buy-side) transactions. 

In the first quarter, Squarefield also advised Netherlands-based fishing and processing firm Parlevliet & Van der Plas (P&P) on its purchase of German seafood distributor and marketer Deutsche See. The integration saw over 1,700 people in 22 locations throughout Germany and around €400 million in revenue change hands, turning P&P into one of the largest seafood companies in the world.

Meanwhile, at Anova, the remaining fresh and premium product range spans cod from the North East Atlantic, shrimp and pangasius from Vietnam, wild salmon from Alaska, and tuna from the Western and Central Pacific. The company processed more than 30,000 ton of fish last year, generating revenues above the €100 million mark.

According to a recent report by KPMG, deal activity in the Netherlands has reached its highest point in a decade.

Firms struggling with turning M&A deals into equity value

18 April 2019 Consultancy.eu

At a time when merger & acquisition activity is on a high, new research highlights that a majority of deals closed aren’t in fact contributing to equity improvements. 

To come to their conclusion, researchers at Willis Towers Watson and Cass Business School analysed the performance of all deals closed in the first quarter of this year with a deal value of above $100 million. For all those deals, 180 in total, the share price of the acquirer was tracked, and benchmarked against an index (MSCI World Index) which monitors equity performance across 20+ developed countries. 

The analysis found that across all regions globally, deals on average had a negative result on the equity value of the acquiring party. Buyers in North America and Asia-Pacific in particular struggled with value creation from their acquisitions. In the US and Canada, companies that were involved in a takeover or merger had a negative performance of 10.1 percentage points compared to the North American index. Asia Pacific buyers lagged 5.0 percentage points behind their regional index. 

Globally, the average stood at 5.4 percentage points behind the index. “The international M&A market as a whole is showing disappointing results, on the back of a volatile transaction climate and global political uncertainty, from trade wars to increasing protectionism,” said Gabe Langerak, a Dutchman who leads Willis Towers Watson’s Mergers & Acquisitions practice for Western Europe.Firms struggling with turning M&A deals into equity valueEurope however bucks the trend and is the only region where large mergers & acquisitions in the first quarter of 2019 had a positive impact on the stock prices (2.8%). Langerak: “The relatively stable – or less unstable – political and economic situation seems to turn out beneficial, and as a result European companies have outperformed their international peers.” It is not just a short term catch – the continent has been performing better for years, with the three-year average at 5.1% above the index. 

Striking, according to the researchers, is that international deals are outperforming national deals. For example, cross-border transactions score 0.9% higher than the index, while cross-regional deals even surpass the index by 3.1%. 

While the ‘financial’ performance of M&A deals is by no means impressive, there are however little signs of deal activity to slow in 2019. “Growing cash reserves, technological disruption and the stagnating growth of emerging markets are still pushing companies towards the M&A market,” explained Langerak. A recent report by Bain & Company found that global merger and acquisition activity spiked last year, growing from $2.9 trillion in 2017 to $3.4 trillion in 2018

The role of private equity, which accounts for a large share of deal activity, is another force lifting M&A activity. Investors are cash rich, and face pressures to spend the money in order to help their backers (mostly institutional investors and family offices) reap better than market average returns. According to one estimate, private equity now sits on $1.7 trillion of funds that is available but can’t be invested (‘dry powder’), with investors struggling with higher multiple and a limited supply of top, well priced targets. “As potential candidates now seem more expensive than during previous M&A peaks, such as in 1999 and 2008, it is more difficult than ever to close successful deals.” 

Langerak concludes with a tip for deal makers; “For M&A experts that want to make a move, it is key to focus on selecting the right acquisition candidates. Proper preparation, integration and the right people are essential to gain the right insights before taking a leap.”