HF Foods Group (NASDAQ: HFFG) plans CAD$47.9M Searay deal
Rhea-AI Filing Summary
HF Foods Group Inc. agreed to acquire Searay Foods Inc. and related entities under a Securities Purchase Agreement signed on July 17, 2026. The buyer group will purchase 100% of the equity of Searay Canada and Morgan Foods, which will become wholly owned subsidiaries, for an aggregate base purchase price of CAD$47,921,740, equal to five times baseline Adjusted EBITDA of CAD$9,556,348 plus CAD$140,000. Consideration includes CAD$38,365,392 in cash, subject to post-closing adjustments, and 1,701,871 HF Foods common shares placed in escrow, plus EBITDA-based earnout payments over two to three years.
A related press release values the deal at approximately CAD$47.9 million (about US$35 million), or roughly 5.0x Searay’s 2025 Adjusted EBITDA of about CAD$9.6 million. Searay has delivered roughly 15% revenue compound annual growth from FY2019 to FY2024 and Normalized EBITDA margins of about 14–15%. The transaction marks HF Foods’ first international expansion into Canada and is expected to be accretive to Adjusted EBITDA, margins, and EPS, supporting a stated goal of expanding consolidated Adjusted EBITDA margin to 4.5%–5.0%+ over three to five years. Closing is expected in Q3 2026, no later than August 31, 2026, subject to customary conditions and regulatory approvals. Part of the consideration will be newly issued, unregistered HF Foods shares relying on Regulation S and Regulation D exemptions.
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8-K Event Classification
4 items: 1.01, 3.02, 8.01, 9.01
4 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 3.02
Unregistered Sales of Equity Securities
Securities
The company sold equity securities in a private placement or other unregistered transaction.
Item 8.01
Other Events
Other
Voluntary disclosure of events the company deems important to shareholders but not covered by other items.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Aggregate base purchase price: CAD$47,921,740
Cash consideration: CAD$38,365,392
Stock consideration in escrow: 1,701,871 shares
+5 more
8 metrics
Aggregate base purchase price
CAD$47,921,740
Total base consideration to acquire 100% of the Company Group’s equity
Cash consideration
CAD$38,365,392
Cash portion of the base purchase price, subject to post-closing adjustments
Stock consideration in escrow
1,701,871 shares
HF Foods common stock to be deposited in escrow at closing
Baseline Adjusted EBITDA
CAD$9,556,348
Baseline Adjusted EBITDA used to calculate the 5x purchase price multiple
Searay 2025 Adjusted EBITDA
approximately CAD$9.6 million
Figure referenced in valuing the transaction at about 5.0x EBITDA
Revenue CAGR
approximately 15%
Searay revenue compound annual growth rate from FY2019 to FY2024
Normalized EBITDA margin
approximately 14–15%
Searay’s cited Normalized EBITDA margins over recent years
HF Foods EBITDA margin target
4.5%–5.0%+
Target consolidated Adjusted EBITDA margin over the next three to five years
Key Terms
Securities Purchase Agreement, Adjusted EBITDA, earnout payments, Regulation S, +2 more
6 terms
Securities Purchase Agreement financial
"entered into a Securities Purchase Agreement by and among the Company"
A securities purchase agreement is a written contract between a buyer and a seller outlining the terms for buying or selling financial assets such as stocks or bonds. It specifies details like the price, quantity, and conditions of the transaction, similar to a shopping list with agreed-upon terms. For investors, it provides clarity and legal protection when transferring ownership of these financial instruments.
Adjusted EBITDA financial
"equal to five times the baseline Adjusted EBITDA of CAD$9,556,348"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
earnout payments financial
"Sellers are eligible to receive contingent earnout payments based on achievement of specified EBITDA targets"
Earnout payments are additional sums the buyer of a business agrees to pay the seller later if the acquired company achieves specific performance goals, like revenue or profit targets. Think of it as a bonus paid after the sale that ties part of the purchase price to future results; for investors this changes how much risk and future cash flow the deal carries and can affect valuation, incentives and reported liabilities.
Regulation S regulatory
"issuances of shares of the Common Stock will be exempt in accordance with Regulation S"
Regulation S is a set of rules that allows companies to sell securities (like shares or bonds) to investors outside the United States without having to follow all U.S. securities laws. It matters because it makes it easier for companies to raise money from international investors while still complying with U.S. regulations.
Regulation D regulatory
"issuances of shares of the Common Stock will be exempt in accordance with Regulation S and Regulation D"
Regulation D is a set of rules that govern how companies can raise money from investors without going through the full process required for public stock offerings. It provides simplified options for private placements, making it easier for companies to seek investments from a smaller group of investors. For investors, it offers opportunities to invest in private companies, often with fewer restrictions, but also with different levels of risk and disclosure.
compound annual growth rate financial
"Searay has demonstrated a revenue compound annual growth rate of approximately 15%"
The compound annual growth rate (CAGR) shows how much an investment or value has grown, on average, each year over a specific period. It considers the effect of growth that compounds or builds upon itself, similar to how interest accumulates in a savings account. Investors use CAGR to compare different investments’ long-term performance and to understand how steady or consistent their growth has been over time.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What acquisition did HF Foods Group (HFFG) announce in this 8-K?
HF Foods Group agreed to acquire Searay Foods Inc. and related entities, including Searay Canada and Morgan Foods, for total base consideration of about CAD$47.9 million, marking HF Foods’ first expansion outside the United States into the Canadian seafood distribution market.
How much is HF Foods Group (HFFG) paying for Searay and how is it structured?
The aggregate base purchase price is CAD$47,921,740, equal to five times baseline Adjusted EBITDA plus CAD$140,000. It includes CAD$38,365,392 in cash, subject to adjustments, and 1,701,871 HF Foods common shares in escrow, plus contingent EBITDA-based earnout payments.
When is the HF Foods Group (HFFG) acquisition of Searay expected to close?
Closing is expected in Q3 2026, no later than August 31, 2026. Completion is subject to satisfaction or waiver of customary closing conditions, including required regulatory approvals, with closing targeted within two business days after those conditions are met.
Why is the Searay acquisition strategically important for HF Foods Group (HFFG)?
The deal represents HF Foods’ first international expansion, entering Canada via Vancouver’s specialty Asian foods market. Searay’s frozen seafood portfolio and brands broaden HF Foods’ assortment and support cross-border synergies with its U.S. distribution network and seafood category focus.
What is Searay’s financial profile in the HF Foods Group (HFFG) deal?
Searay’s 2025 Adjusted EBITDA is cited at about CAD$9.6 million, implying a roughly 5.0x purchase multiple. From FY2019 to FY2024, Searay achieved about 15% revenue compound annual growth and 14–15% Normalized EBITDA margins, highlighting a relatively high-margin seafood platform.
How does the Searay acquisition relate to HF Foods Group’s (HFFG) margin targets?
HF Foods states the transaction is expected to be accretive to Adjusted EBITDA and margins. The company reaffirms its previously communicated goal of expanding consolidated Adjusted EBITDA margin to roughly 4.5%–5.0%+ over the next three to five years.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 17, 2026
(Exact name of registrant as specified in its charter)
State or other Jurisdiction of incorporation ) | (Commission File No.) | (IRS Employer Identification No) | ||||||
(Address of principal executive offices) | (Zip Code) | ||||
Registrant’s telephone number, including area code: (888 )-905-0998
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01. Entry into a Material Definitive Agreement.
On July 17, 2026, HF Foods Group Inc. (the "Company”) entered into a Securities Purchase Agreement (the "Agreement") by and among the Company, HF Acquisition Newco Inc., a Delaware corporation and wholly-owned subsidiary of the Company (the "Buyer"), HF Toro Canada Holdings Inc., a British Columbia limited company (“Searay AcquisitionCo" and, together with the Company and the Buyer, the "Buyer Entities"), Searay Foods Inc., a corporation formed under the laws of British Columbia ("Searay Canada"), Morgan Foods Inc., a corporation formed under the laws of British Columbia ("Morgan Foods" and, together with Searay Canada, the "Company Group"); the sellers named therein (the "Sellers"), and Jackie Chi Fai Chan, solely in his capacity as the representative of the Sellers, pursuant to which the Buyer Entities will acquire 100% of the issued and outstanding securities of the Company Group from the Sellers (the “Transaction"). Pursuant to the Agreement, the Sellers, who together are the legal and beneficial owners of 100% of the issued and outstanding securities of the Company Group, agreed to sell all of such securities to the Buyer Entities. At the closing of the Transaction (the "Closing"), Searay AcquisitionCo will have purchased the Company Securities of both Searay Canada and Morgan Foods from the applicable Sellers. As a result of the transaction, Searay Canada and Morgan Foods will be wholly-owned subsidiaries of the Company.
Under the terms of the Agreement, the aggregate base purchase price is CAD$47,921,740 (equal to five times the baseline Adjusted EBITDA of CAD$9,556,348, plus CAD$140,000), payable as (i) CAD$38,365,392 in cash (subject to customary post-closing adjustments) and (ii) 1,701,871 shares of the Company's common stock to be deposited in escrow. In addition, the Sellers are eligible to receive contingent earnout payments based on achievement of specified EBITDA targets over a two- to three-year period following the closing. The Agreement also contains customary representations, warranties, covenants, and indemnification provisions.
The Closing is expected to occur no later than the second business day following the satisfaction or waiver of customary closing conditions set forth in the Agreement, including the receipt of required regulatory approvals, and in no event later than August 31, 2026, unless earlier terminated or extended in accordance with the terms of the Agreement.
In connection with the Agreement, certain key employees of the Company Group, including a Seller, entered into employment agreements with a subsidiary of the Company.
The foregoing description of the Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 3.02 Unregistered Sales of Equity Securities.
The disclosure included in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference. The issuances of shares of the Common Stock in Item 1.01 above will be exempt from the registration requirements of the Securities Act of 1933, as amended, in accordance with Regulation S and Regulation D thereunder.
Item 8.01 Other Events.
On July 23, 2026, the Company issued a press release announcing the Transaction. A copy of the press release is filed as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
| Exhibit No. | Description | |||||||
10.1 | Securities Purchase Agreement, dated as of July 17, 2026, by and among HF Foods Group Inc., HF Acquisition Newco Inc., HF Toro Canada Holdings Inc., Searay Foods Inc., Morgan Foods Inc., the Sellers named therein, and Jackie Chi Fai Chan, as Sellers Representative.*† | |||||||
99.1 | Press release, dated July 23, 2026 | |||||||
| 104.0 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
* Schedules and similar attachments have been omitted pursuant to Item 601(b)(5)of Regulation S-K. The Company hereby undertakes to furnish copies of any of the omitted schedules upon request by the SEC; provided, however, that the Company may request confidential treatment pursuant to Rule 24b-2 of the Exchange Act for any schedules so furnished.
†Certain portions of this exhibit have been omitted in accordance with Regulation S-K Item 601(b)(10)(iv) because they are both (i) not material to investors and (ii) the type of information that the Company customarily and actually treats as private or
confidential, and have been marked with ‘‘[***]’’ to indicate where omissions have been made. The Company agrees to furnish supplementally an unredacted copy of the exhibit to the SEC upon its request.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| HF FOODS GROUP INC. | ||||||||
| Date: July 23, 2026 | /s/ Paul McGarry | |||||||
| Paul McGarry | ||||||||
| Chief Financial Officer | ||||||||
Exhibit 99.1
HF Foods Group to Acquire Searay Foods, a Highly Attractive Canadian Importer and Distributor of Ethnic and Specialty Seafood Products, Marking the Company's First International Expansion
Strategic entry into Canada through the Vancouver metro market, one of North America's premier specialty Asian foods markets with deep multicultural ties
Reinforces HF Foods' positioning as the acquiror of choice, extending its proven M&A playbook into new geographies
Transaction valued at approximately 5.0x Searay's 2025P Adjusted EBITDA and is expected to be immediately accretive to Margins and EPS
Consideration to be funded through a combination of cash and HF Foods common stock
HF Foods' reaffirms previously communicated target of expanding consolidated Adjusted EBITDA margin to 4.5%-5.0%+ over the next three to five years
LAS VEGAS, July 23, 2026 (GLOBE NEWSWIRE) — HF Foods Group Inc. (NASDAQ: HFFG) (“HF Foods” or the “Company”), a leading distributor of international foodservice solutions to Asian restaurants and other businesses across the United States, today announced that it has entered into a definitive agreement to acquire Searay Foods Inc. and its related entities (“Searay”), a leading Canadian importer and distributor of ethnic and specialty frozen seafood, headquartered in Richmond, British Columbia. The transaction represents HF Foods’ first expansion outside the United States and is expected to close in Q3 2026, subject to customary closing conditions and regulatory approvals.
Under the terms of the agreement, HF Foods will acquire up to 100% of the outstanding equity interests of Searay for total consideration of approximately CAD$47.9 million (approximately US$35 million), representing approximately 5.0x Searay's 2025 Adjusted EBITDA of approximately CAD$9.6 million. Consideration will be funded through a combination of cash on hand and shares of HF Foods common stock, with final terms to be disclosed upon closing.
Management Commentary
“The acquisition of Searay is a pivotal milestone in HF Foods’ growth journey and the first step in our long-stated strategy to expand our platform beyond the United States,” said Felix Lin, President and Chief Executive Officer of HF Foods. “Searay has built an exceptional reputation over 25 years as a leading Canadian distributor of ethnic frozen seafood, with deep supplier relationships, a trusted multi-brand portfolio, and industry-leading margins. This transaction is consistent with the disciplined, accretive M&A strategy we have communicated to investors, and we are excited to combine Searay’s expertise in frozen seafood with HF Foods’ national distribution infrastructure to unlock meaningful cross-selling and supply chain synergies across both businesses.”
“We are proud of what we have built at Searay over the past 25 years, and we believe HF Foods is the right partner to carry that legacy forward,” said Jack and Philip Chan, Co-Presidents and founders of Searay. “HF Foods’ scale, distribution network, and shared commitment to quality and customer service make this a natural combination. We look forward to working alongside the HF Foods team to accelerate Searay’s growth, including our ongoing expansion into the U.S. market.”
Strategic Rationale
•First International Expansion: The transaction marks HF Foods’ entry into Canada and establishes a platform to pursue further growth across North America, consistent with the Company’s previously disclosed proven M&A playbook of geographic expansion, increased distribution capabilities, and new product categories.
•Complementary Product Portfolio: Searay’s ethnic frozen seafood offering, including its Searay Foods, Thai Best, Pinoy’s Best, Smart Fish, Diamond Shrimp, and Gold Label brands, broadens HF Foods’ specialty product assortment and deepens its presence in the seafood category, which represents approximately 36% of HF Foods’ existing net revenue.
•Cross-Border Synergies: Searay’s recently established U.S. operations, including its planned Los Angeles direct import operations, are expected to benefit from HF Foods’ existing distribution network, sourcing scale, and West Coast infrastructure.
•Attractive Financial Profile: Searay has demonstrated a revenue compound annual growth rate of approximately 15% from FY2019 to FY2024 and strong Normalized EBITDA margins of approximately 14-15%, supported by disciplined inventory management and long-tenured supplier and customer relationships.
•Accretive Transaction: The acquisition is expected to be accretive to HF Foods’ Adjusted EBITDA and margins, consistent with the Company’s previously communicated target of expanding consolidated Adjusted EBITDA margin to 4.5%-5.0%+ over the next three to five years.
Transaction Details
HF Foods will acquire up to 100% of Searay Foods Inc., Morgan Foods Inc., and Searay Foods USA Inc. for total consideration of approximately CAD$47.9 million (approximately US$35 million based on current exchange rates), representing approximately 5.0x Searay's 2025 Adjusted EBITDA of approximately CAD$9.6 million. The consideration is expected to be funded through a combination of cash on hand and newly issued shares of HF Foods common stock; the final split between cash and stock consideration will be disclosed at closing. Following the closing of the transaction, Searay's existing management team, led by incoming Chief Executive Officer Derick Ngan, is expected to continue to lead Searay's day-to-day operations as a subsidiary of HF Foods.
The transaction is expected to close in Q3 2026, subject to customary closing conditions, including regulatory approvals.
About HF Foods Group Inc.
HF Foods Group Inc. is a leading marketer and distributor of fresh produce, frozen and dry food, and non-food products to primarily Asian restaurants and other foodservice customers throughout the United States. HF Foods aims to supply the increasing demand for Asian American restaurant cuisine, leveraging its nationwide network of distribution centers and its strong relations with growers and suppliers of fresh, high-quality specialty restaurant food products and supplies in the US and Asia. Headquartered in Las Vegas, Nevada, HF Foods trades on Nasdaq under the symbol “HFFG”. For more information, please visit www.hffoodsgroup.com.
About Searay Foods Inc.
Founded in 2000 and headquartered in Richmond, British Columbia, Searay Foods Inc. is a leading Canadian importer and distributor of branded ethnic and specialty frozen seafood, serving retail, wholesale, and restaurant customers across North America. Searay sources premium frozen seafood from more than 80 suppliers worldwide and distributes its products through six proprietary brands, including Searay Foods, Thai Best, Pinoy’s Best, Smart Fish, Diamond Shrimp, and Gold Label.
Forward-Looking Statements
All statements in this news release other than statements of historical facts are, or may be deemed to be, “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and contain our current expectations about our future results, including statements regarding the expected timing, benefits, and effects of the proposed acquisition of Searay. We have attempted to identify any forward-looking statements by using words such
as “expects,” “believes,” “anticipates,” “plans,” “will,” “target” and other similar expressions. Although we believe that the expectations reflected in all of our forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Such statements are not guarantees of future performance or events and are subject to known and unknown risks and uncertainties that could cause the Company’s actual results, events, or financial positions to differ materially from those included within or implied by such forward-looking statements, including risks relating to the Company’s ability to satisfy closing conditions and consummate the proposed acquisition on the anticipated terms or timing, or at all, risks relating to the Company’s ability to successfully integrate Searay’s operations and realize anticipated synergies, risks relating to the impact of foreign currency fluctuations, and other factors disclosed under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 and other filings with the Securities and Exchange Commission (the “SEC”). Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Except as required by law, we undertake no obligation to disclose any revision to these forward-looking statements.
Contacts:
ICR
Anna Kate Heller
hffoodsgroup@icrinc.com