Bumble Bee Foods, one of the nation’s most recognized tuna brands, has filed for Chapter 11 bankruptcy protection, becoming the latest iconic American food company to fall on hard times.
FCF Co. Ltd., a multinational seafood conglomerate based in Taiwan, will reportedly acquire Bumble Bee for $925 million.
Bumble Bee has sold canned seafood and other food products under a variety of different brand names, helping to make tuna a staple of consumer lunchboxes for close to 120 years. It has reportedly faced some challenges in recent years with legal issues and increasing debt problems, as well as declining demand for tuna, which it has blamed on the changing tastes of millennials.
What is price fixing?
Bumble Bee’s declaration of bankruptcy comes two years after the company pleaded guilty to fixing the price of tuna along with two other canned tuna producers, Chicken of the Sea and StarKist.
Generally speaking, price fixing occurs when competitors agree to raise the price of a product, according to the U.S. Department of Justice. Price fixing is usually done secretly between companies that typically compete with one another, and at the expense of the consumers, who are often forced to pay higher prices. The practice is illegal, according to the Federal Trade Commission, a federal agency charged with consumer protection.
The Department of Justice fined Bumble Bee $25 million for price fixing that occurred between 2011 and 2013. Bumble Bee still owes $17 million of that fine, according to its news reports. Bumble Bee also faces civil lawsuits related to its role in price fixing from companies including Sysco and U.S. Foods.
It also reportedly owes FCF, its potential buyer, $50 million for business expenses.
Did millennials kill the tuna sandwich?
Despite its debt problems, some canned tuna companies have blamed millennials for the “death” of the tuna industry. In fact, per capita consumption of canned tuna has fallen 42% during the 30 years up to and including 2016, according to the Wall Street Journal.
Research also indicates that 32% of people between the ages of 18 and 34 have recently bought tuna, compared to 45% of people 55 years and older, according to a 2018 Mintel study.
Millennials have been lampooned for eating avocado toasts and for killing a variety of other classic foods including American cheese, cereal, and even raisins. Most recently, millennials were blamed for killing the milk industry, when milk producer Dean Farms declared bankruptcy.
Between 2012 and 2017, sales of dairy milk fell 15% while sales of non-dairy milk alternatives increased 61%, according to a Mintel study.
StarKist’s CEO Andy Mecs has reportedly said that millennials aren’t buying canned tuna because they “don’t even own can openers,” and therefore can’t open canned tuna. In reaction, companies including StarKist and Bumble Bee have started selling tuna in millennial-friendly pouches.
Traditional tuna producers are also combatting the emergence of tuna manufacturers such as Wild Planet Foods, which allegedly produce more sustainable and environmentally friendly tuna.