Thai Union buys into Red Lobster

Thai Union buys into Red Lobster

A Red Lobster restaurant in an unspecified location in the United States. (Red Lobster Hospitality LLC photo)
A Red Lobster restaurant in an unspecified location in the United States. (Red Lobster Hospitality LLC photo)

Thai Union Group Plc, a SET-listed seafood supplier, has acquired a minority stake of the US-based Red Lobster restaurant operator for $575 million (20.24 billion baht), the company said on Tuesday.

The sellers were direct and indirect equity holders of Red Lobster including affiliates of investment funds managed by Golden Gate Private Equity Inc.

The Thai seafood supplier paid $230 million for 25% of Red Lobster Master Holdings, a Delaware limited partnership.

It also paid another $345 million for preferred units and shares for another 24% of the restaurant chain that can be converted in 10 years, according to documents filed with the Stock Exchange of Thailand.

Red Lobster had $2.48 billion in sales for the 12-month period that ended in August, the documents showed. It had an operating profit of $144 million.

Thai Union supplies lobster, shrimp, sardines, mackerel, tuna, salmon and crab to global markets. It owns a number of leading, global seafood brands, including Chicken of the Sea, King Oscar, John West and Petit Navire, in addition to facilities in 12 countries.

The company came under scrutiny in 2015 when an AP investigation tied it to slavery in southeast Asian fishing waters and at factories. It later said it cut ties with contractors accused of using slave labour.

Red Lobster is an American casual dining restaurant chain headquartered in Orlando, Florida. The company has operations in Canada, Malaysia, Saudi Arabia, the United Arab Emirates, Qatar, Mexico, and Japan, in addition to the US.

Thai Union shares (TU) rose 0.48% to 20.80 baht at 2.16pm on Tuesday in trade worth 132.74 million baht.

The interior of a Red Lobster restaurant in an unspecified location. (Red Lobster Hospitality LLC photo)

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