Bloomberg Anywhere Bloomberg Professional About Bloomberg


 
Connors Bros. Stock Drops on Recall Over Botulism (Update2)

By Kevin Bell

July 23 (Bloomberg) -- Connors Bros. Income Fund stock fell the most in eight months after the Canadian company expanded a recall linked to botulism to include more than 80 food products and four varieties of canned pet food.

Connors Bros. stock dropped 84 cents, or 7.9 percent, to C$9.81 by 4:10 p.m. in trading on the Toronto Stock Exchange, the biggest decline since November. Units of Connors Bros., an income trust based in Blacks Harbour, New Brunswick, have fallen 12 percent since July 18.

The U.S. Food and Drug Administration said July 18 that four people got sick from consuming some food made by the company's Castleberry's Food division at its Augusta, Georgia, plant. The unit shut that plant July 21 for about a week because executives said food on a production line may not have been cooked enough.

Products made on that line in the past two years have been added to the recall after tests on 17 cans of hot dog chili sauce showed all except one were positive for the toxin that produces botulism, Dave Melbourne, a Castleberry's Food vice president, said today on a conference call.

Connors Bros., a maker of canned fish and meat, is cooperating with U.S. agencies in their investigation into the possible cases of botulism, which can cause symptoms including blurred vision, slurred speech and in some cases paralysis.

No other cases of illness have been reported since the original recall, the company said. ``We are deeply, deeply sorry for the situation,'' Melbourne said.

Pet Food Recall

The expanded recall involves two varieties of Great Value canned chili sold only in Canada and four kinds of Natural Balance dog food cans. Among the brands recalled are: Austex, Kroger, Meijer and Piggly Wiggly. The company withdrew 10 items originally.

The products being recalled account for less than 4 percent of the income fund's revenue, the company said. Sales at the income trust, a structure that avoids most corporate taxes, were $938.2 million in 2006.

Chief Financial Officer Kent McNeil said it's too early to determine how much the recall will cost. Connors has insurance to cover withdrawing products from the market, he said.

To contact the reporter on this story: Kevin Bell in Toronto at kbell2@bloomberg.net

Last Updated: July 23, 2007 16:16 EDT

Sponsored links