BBNC to acquire two giants of Alaska's Pacific cod fishery
The Bristol Bay Native Corporation has been working for a year to acquire two of the largest Pacific cod harvesters in the country. Now, it is about to close that deal.
Clipper Seafoods and Blue North Fisheries are freezer longline catchers, two giants of the Pacific cod industry. Clipper has six hook and line vessels, and after retiring one of its vessels, Blue North will have four. Now, the Bristol Bay Native Corporation is poised to acquire all of them.
“BBNC has been looking at an investment or opportunities within the broader seafood sector for a couple of years," said BBNC CEO and President Jason Metrokin. “Blue North and Clipper Seafoods, as of Friday last week, have officially merged together. And then BBNC’s intentions are to acquire the merged companies – the Blue North Clipper Group – on Sept. 30.”
Together, the Blue North-Clipper Group has 37.4% of the total allowable catch designated to longlines for Alaska Pacific cod. Clipper has 20%, and Blue North has 17.4%.
To organize the two companies, BBNC has formed the subsidiary Bristol Bay Alaska Seafoods. Dave Little, former president of Clipper, will head the subsidiary in the same role. BBNC has also formed the holding company Bristol Bay Seafood Investments to manage the new company’s funding, as well as any future involvement in seafood.
The U.S. Department of Justice paved the way for the merger last week by ruling that it did not violate any antitrust rules.
Metrokin says this deal follows the corporation’s investment strategy to diversify its income streams and operating companies. He said it will also substantially benefit the corporation’s shareholders by directing that income toward the state and the Bristol Bay region.
“Bringing the earnings from the Bering Sea cod sector back to Alaska, back to the region through dividends to our shareholders, but also employment opportunities," he said. "So there’s a real good value as an Alaskan in this deal, and it really meets BBNC’s investment strategy on a lot of levels.”
Management for the hook and line sector across the Gulf of Alaska, Aleutian Islands, and Bering Sea has changed drastically since it was established in the 1980s. It is now run as a freezer longline cooperative, which the member companies formed voluntarily in 2010. That was a decade after cod was allocated to nine different sectors. The hook and line sector gets almost half of the quota.
“You had to catch the fish immediately," said Mike Burns, formerly of Blue North Fisheries. He explained that the companies were founded when the fishery was first come, first serve – a so-called "Olympic fishery."
“And now we’re in a different world today," Burns said. "And the impetus to put these companies together to form a better and stronger, more efficient company to take on the challenges of the 21st century, that’s what we gain by putting these two companies together.”
This is BBNC’s first foray into seafood since the corporation purchased Peter Pan Seafoods in 1975. (It sold its shares in that company a few years later.) It reported a revenue of $1.7 billion in 2019, 58% of which comes from services to the oil and gas industry, as well as fuel distribution. While CEO Jason Metrokin didn’t say how much revenue the deal would bring to the corporation annually, he said it would be significant.
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