China’s Shuanghui International said Wednesday it has entered into a 4.7 billion US dollar merger deal with the world’s largest pork processor, Smithfield Foods, to create a leading global pork enterprise. The deal still awaits approval from US regulators and will be voted by Smithfield shareholders.
The acquisition valued Smithfield at approximately $7.1 billion, including the assumption of Smithfield’s net debt.
Under the terms of the agreement, Shuanghui will acquire all of the outstanding shares of Smithfield for 34 dollars per share in cash. The purchase price represents a premium of approximately 31% over Smithfield’s closing stock price on May 28, 2013, the last trading day prior to today’s announcement.
Wan Long, Chairman of Shuanghui International, said, “The proposed takeover is subject to approval by US regulators on antitrust and competition grounds, as well as a review by the Committee on Foreign Investment in the United States. We predict that it will take 2 or 3 months to complete the whole process. ”
Smithfield Foods is the world’s largest pork processor and hog producer, and it’s also the US largest pork processor, while Shuanghui International is the majority shareholder of Shuanghui Investment & Development Co., which is China’s largest meat processing enterprise and China’s largest publicly traded meat products company.
“Smithfield has high-quality capital, comprehensive management system, professional management team and food safety control system. So Shuanghui will maintain Smithfield operations, staff, management, brand and place and promises no staff layoffs and no closure of factory,” Wan said.
And Smithfield will continue to work with American farmers, producers and suppliers. So U.S. consumers will continue to enjoy the high-quality and safe meat products from the company.