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Canada eyes Chilean arm of troubled Spanish fishery firm

Jan. 13, 2014 at 8:50 PM   |   Comments

SANTIAGO, Chile, Jan. 13 (UPI) -- Canadian fisheries group Cooke Aquaculture is looking to acquire Pesca Chile, the Latin American country's subsidiary of the troubled Spanish fisheries multinational Pescanova S.A.

Pescanova and its operations in 21 countries across the world are facing a meltdown as company data show the business is all but bankrupt.

Pescanova was founded in 1960 in Vigo, the Galician port city in the northwestern Spanish province of Pontevedra in 1960. Its innovative processing of fish aboard its own vessel was among factors that led to the company's rapid growth and expansion until it fell victim to Spain's ongoing economic crisis.

Three major financial groups were in talks Monday as part of an effort to hammer out a deal that will recapitalize the Galician group and help save its subsidiaries, including Pesca Chile, and all or most of about 3,400 jobs across the group.

The Canadians in their quest for Pesca Chile were aided by Philadelphia firm Econsult, officials said.

Despite the buyout negotiations involving the Canadian and U.S. firms, it is far from clear if Pescanova itself wants to let Pesca Chile go to the Canadians or anyone else, business analysts cited in Chilean media said.

Instead, analysts said, Pescanova is waiting to see the outcome of negotiations about its own fate.

Pescanova's assets include more than 120 fishing boats active worldwide and production plants in Latin America, southern Africa and Europe.

As recapitalization of the parent group in Spain looms, Pesca Chile has been at the center of efforts by Pescanova to delay the sale of the Chilean operations as long as possible, Diario Financiero reported.

Pescanova President Juan Manuel Urgoiti visited Chile recently in a bid to head off a sale of the Chilean operation.

Talks also involved officials concerned with the bankruptcy processes, the Faro de Vigo newspaper said.

Minority shareholders in Pescanova are up in arms over the negotiation process and warned banks involved with the process they won't accept a solution that undermined their interests, the Fish Information and Services reported on its website.

The campaign group wants the current Pescanova board sacked and a new management put in its place.

Pescanova's debt mountain also raised some controversy, FIS reports indicated.

Spain's National Securities Market Commission said Pescanova has an accumulated debt of $5.8 billion -- higher than the $5 billion cited by official receiver Deloitte.

Creditors involved with the negotiations were fighting for the control of Pescanova, La Voz de Galicia reported.

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