The business world is buzzing this morning about Bumble Bee Foods, which filed for Chapter 11 bankruptcy protection.
The company is best known for its canned tuna, a kitchen staple that millennials are accused of killing, though a price-fixing scandal and a general lack of innovation also contributed to its downfall.
Taiwan-based FCF Co. is buying Bumble Bee’s assets for an estimated $925 million, the latter said in a statement.
“It’s been a challenging time for our company but today’s actions allow us to move forward with minimal disruption to our day-to-day operations,” president and CEO Jan Tharp said.
At the top of the list of Bumble Bee creditors who have the largest unsecured claims are FCF, with a little over $50.5 million for business debt, and the U.S. Department of Justice, with $17 million stemming from the price-fixing scandal, according to the company’s filing in bankruptcy court in Delaware.
Roughly three years ago, the DOJ announced it had found evidence of a massive price-fixing scheme in the tuna business and cited Bumble Bee, StarKist, and Chicken of the Sea. Bumble Bee pled guilty in May 2017 for its role in the con, involving foods such as canned and pouch tuna, which lasted from as early as the first quarter of 2011 through at least the fourth quarter of 2013. The $17 million is what it still owes the federal government.
But the popularity of shelf-stable tuna was already declining. Consumption of canned tuna was 2.1 pounds per person in 2016, down from close to four pounds in 1989, according to data from the U.S. Department of Agriculture last updated in May.
Once the classic American lunch, it came up against eaters who wanted more fresh and organic foods, as they embraced healthier eating habits, migrated from products by massive food manufacturers to more high-end offerings, and opted for vegetarian or vegan lifestyles. Reports about mercury levels in fish and dolphins getting caught in tuna-boat nets didn’t help either.
Fresh tuna, perhaps fortified by the ever-growing sushi and later poke demand, grabbed some of the limelight, as did other species of fish, because Americans began to try other varieties of seafood, including those not known for recipes heavy with mayonnaise, another food millennials are blamed for killing.
“Bumble Bee just has not progressed and has not been innovative and has not done a lot of the things they should be,” said Phil Lempert, founder of supermarketguru.com. “The brand has become irrelevant. . . . It’s a combination of not understanding what the consumer wants and not delivering for them.”
San Diego-based Bumble Bee—whose brands include Brunswick, Snow’s, Wild Selections, and Beach Cliff—marked its 120th birthday this year.