US canned seafood giant Bumble Bee Foods is planning on filing for Chapter 11 bankruptcy protection and place itself for sale, according to a report in the Wall Street Journal.
The Journal, citing people familiar with the matter, said legal costs stemming from the company's tuna price-fixing and class-action lawsuits were behind the company's financial woes.
In 2017, Bumble Bee agreed to plead guilty to a one-count violation of the Sherman Antitrust Act for its role in a conspiracy to fix the prices of packaged seafood sold in the United States, and pay a fine of $25 million (€21.1 million). Thai Union struck a deal with the DOJ in 2017, and Starkist plead guilty in October 2018.
The company has also been fighting a class-action suit brought against the tuna giants by retailers, consumers and others claiming damages from the alleged conspiracy to set canned seafood prices. Yet another class-action suit was brought against the "Big Three" tuna companies in May, alleging the dolphin-safe labels used by the companies are misleading and fraudulent.
Bumble Bee and private equity owner Lion Capital declined to comment to IntraFish on the reports of its impending bankruptcy filing.
Bloomberg first reported the bankruptcy rumors in August, noting Lion hired turnaround firm AlixPartners LLP in July to help the group recover from its mounting losses.
In April, Bumble Bee reportedly began its hunt for a buyer for its Clover Leaf Seafood brand, though sales rumors have swirled around Bumble Bee for several years.
Former Bumble Bee CEO Chris Lischewski's federal criminal price-fixing trial began earlier this month. The executive is being accused by the US Department of Justice (DOJ) of orchestrating the price-fixing scheme.
Lischewski is facing the possibility of 10 years in prison and up to $1 million (€1.2 million) in fines. Four tuna company executives have previously plead guilty to their roles in the conspiracy.