Castleberry’s Recall Cost $35 Million

TORONTO — Connors Bros. Income Fund has estimated the cost of a massive chili product recall at $35 million.

In a release, the parent company of Castleberry’s said a charge for this amount will be recognized in the fiscal quarter ended June 30, 2007. In order to pay for the cost of the recall, the fund is suspending distributions effective immediately.

 A distribution announced in July will still be paid, the company said.

"While the products involved in the recall represent just four percent of our annual revenue, the cost to successfully recall these products is significant," said Chris Lischewski, president and CEO of the fund's operating subsidiaries. "We believe the $35 million estimate is comprehensive in covering the known cost elements at this time including product recall, destruction, effectiveness checks, quality inspections, consumer reimbursement, professional services, factory shutdown and start-up costs.”

Read the full release at the Connors Bros. Web site here.