Smithfield Foods sells complete stake in Campofrio Food Group for $354m

China-based Smithfield Foods, a fully owned subsidiary of the WH Group, has divested its entire equity interest in Spanish sausage maker Campofrio Food Group to Alfa for $354m in cash.

According to a filing from the Mexico-based parent company San Pedro Garza Garcia, the 37% holding will be eventually sold to Alfa’s Sigma unit.

Alfa had already bought the rest of the company in two previous transactions, which began in late 2013.

Smithfield’s CEO Larry Pope said: "This transaction reflects Smithfield’s commitment to continually review our portfolio and generate cash to support our long term priorities. It is aligned with our strategic initiative to strengthen our balance sheet and reduce our financing costs."

Alfa said in a statement that the deal would allow both direct and indirect control over Campofrio through Sigma.

WH Group CEO Wan Long said: "The transaction will further strengthen WH Group’s financial fundamentals and improve our capital structure. This will lay a solid foundation for our future development and global expansion.

"We will uphold our global expansion strategy to further strengthen our leadership in the global pork industry. With the European Union remaining a strategic focus, we will tap growth from the ongoing development of our existing platform there, as well as from continuing to identify potential strategic acquisitions."

Campofrio Food Group specialises in producing processed meats that it markets under its brands, including Campofrio, Aoste, Cochonou, Fiorucci, Justin Bridou, Marcassou, Moroni, Navidul, Revilla, Nobre, Stegeman, Oscar Mayer.

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Image: Campofrio Food Group specialises in producing sausages,cured ham, Turkey and chicken, meats, pates and prepared foods products. Photo: courtesy of amenic181/freedigitalphotos.net.