Merger Talks Terminated
Jul. 22, 1988
PITTSBURGH (AP) _ H.J. Heinz Co. said Friday its agreement to acquire Bumble Bee Seafoods Inc. has been terminated.
The announcement comes two months after the U.S. Justice Department said it would file suit to stop the deal on anti-trust grounds.
The federal regulators said that Heinz's wholly owned Star-Kist Foods Inc. and San Diego-based Bumble Bee account for half of the $1 billion retail canned tuna market in the United States.
Heinz argued that foreign tuna canners would provide sufficient competition to keep prices down.
Heinz said it wanted Bumble Bee for economies of scale and cited Star-Kist and Bumble Bee plants on Puerto Rico that are separated by only a chain-link fence.
Termination of the merger was announced in a statement from Heinz late Friday, when its spokesmen were unavailable to elaborate.
The deal was announced in February. The Justice Department objected in May, and in June Heinz extended the merger agreement while it studied the government's position.
Heinz never disclosed the purchase price for Bumble Bee, a former Castle & Cooke unit that was taken private by managers and investors in 1985 for $60 million.
The other leading U.S. producer of canned tuna is Chicken Of The Sea, owned by Ralston Purina.