Thai Seafood Supplier Buys $575 Million Stake in Red Lobster
Seafood supplier Thai Union Group PCL purchased a minority stake in Red Lobster for $575 million, the companies reported Monday. The supplier, which is the world’s largest producer of canned tuna, paid $230 million for a 25 percent stake and an additional $345 million for a 24 percent stake that it can convert in 10 years through preferred shares.
Private-equity group Golden Gate Capital, which purchased Red Lobster from Darden Restaurants for $2.1 billion in 2014, will remain the majority owner. Thai Union Group has been involved with the 700-restaurant seafood chain on the supplier level for more than 20 years. Red Lobster, headquartered in Orlando, Florida, has 58,000 employees nationwide.
According to documents filed with the Stock Exchange of Thailand, Red Lobster had 2.479 billion in sales for the 12-month period that ended in August, and an operating profit of $144 million.
Thai Union Group, known for its “Chicken of the Sea” tuna product, also supplies Walmart and Costco. The company received six-month bridge loans of $575 million from Bangkok Bank, Siam Commercial Bank, and Bank of Ayudhya for the purchase. Earlier in the year, they bought Canadian lobster processor Les Pecheries de Chez Nous for an undisclosed amount.
Thai Union Group was the target of controversy in 2015 when The Associated Press reported that the company was involved in slavery in southeast Fishing waters and at factories. The company responded by saying that it cut ties with the contractors accused.