Nueva Pescanova’s sale process to Cooke canceled by Abanca

Negotiations of a sale of Nueva Pescanova to Cooke Inc. have been called off by Abanca, the owner of the Redondela, Pontevedra, Spain-based vertically integrated seafood firm.

Cooke entered into an exclusivity agreement with Abanca in April 2023 in negotiating a purchase of an 80 percent stake in Pescanova, but the deal-making went cold in July after the two sides could not come to an agreement on the price. In June, Cooke lowered its offer for Nueva Pescanova, originally in the range of EUR 150 million (USD 165 million) plus the assumption of EUR 500 million (USD 552 million) in liabilities in exchange for an 80 percent ownership stake, to EUR 50 million (USD 54.7 million) plus a capital injection of EUR 200 million (USD 218.8 million). It was rejected by Abanca and the offer was withdrawn, according to Faro de Vigo.

In August,  El Confidencial reported Cooke had broken off negotiations with Pescanova’s owner, Abanca, after a report from financial service firm EY discovered a large cash shortage and shortcomings in financial management at Pescanova, requiring “extraordinary capital contributions” if an acquisition were to take place. In comments to SeafoodSource, a spokesperson for Nueva Pescanova denied a cash crunch was threatening the transaction.

In a statement issued Tuesday, 31 October, Abanca said it had terminated the sale process.

“The negotiations, carried out with great professionalism by the two interested parties, came to an end by mutual agreement,” Abanca said.

Abanca said it has initiated a process of “new strategic, financial, commercial and people positioning in Nueva Pescanova.” The objective is to “strengthen the business project of the fishing company, its competitiveness and its business model.”

Abanca said it will continue to build a roadmap toward greater future profitability, spearheaded by Jorge Escudero, who was appointed as Nueva Pescanova’s new CEO in September 2023 after Ignacio González stepped down in June 2023. The company said it initiated the first part of this plan with the layoffs of 82 staff in September 2023, which it said at the time was meant to allow it to “adapt to a challenging global environment [in order to] ensure the long-term sustainability of the company.”

The company recorded a EUR 53 million (USD 56.7 million) loss in its most recent fiscal year, which ended in March 2023.

"After the results of the last fiscal year, derived mainly from the high costs and the inflationary environment, the company considers it essential to optimize its structure to adapt it to a market that is going through difficult times,” it said. “Nueva Pescanova seeks, with these adjustments, to improve its positioning in the market and maintain the excellence of its services and products."

Abanca CEO Juan Carlos Escotet told Faro de Vigo the sale process was no longer active, despite Cooke CEO Glen Cooke expressing continued interest in the acquisition at the beginning of October.

"We have decided to put the search process for an industrial partner on hold,” he said.

He said the two-year sales process, which initially attracted interest from Red Chamber and Iberconsa in addition to Cooke, was no longer in Abanca’s plans.

"We have clearly prioritized strengthening and making possible the strategic plan that is now beginning," Escotet said. "There will always be time for that [in reference to the sale], it is not our priority. The company is doing well.”

Photo courtesy of Abanca