Del Monte Foods Company (NYSE: DLM) is responding to written reports and confirmed that the company is exploring strategic alternatives for its seafood business, which could include a potential sale of the business.
Of course it cannot assure that its exploration of strategic alternatives will result in a transaction and that the Board of Directors has not approved a transaction at this time.
Del Monte Foods generated $3.414 Billion in sales for fiscal April 29, 2007, and StarKist Seafood operating segment had sales of $542.4 million, a decrease of $23.5 million or 4.2%, compared to fiscal 2006. Del Monte’s total market cap is $1.87 Billion with shares down about 1.6% today.
The company also noted that it and two others accounted for some 79% of the canned tuna market, with Del Monte’s StarKist having some 33.7% of that market.
StarKist is a brand that it should be able to unload rather easily despite some of the slowing from 2006 to 2007, or so it would seem. Owning that much market share is perhaps value enough, particularly if this can be combined with another operation.
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Jon C. Ogg
May 16, 2008
Jon Ogg produces and edits the "10 Stocks Under $10" newsletter and he does not own securities in the companies he covers.