Leucadia to acquire majority stake in National Beef

US-based investment firm Leucadia National has entered into an agreement to acquire a 79% stake in US beef processing company National Beef in a deal worth $867.9m.

Leucadia said that, following the acquisition, the current owners of National Beef – US Premium Beef (USPB), NBPCo Holdings, and National Beef CEO Timothy Klein – will become minority stakeholders, while the company’s operations and management structure will remain the same.

USPB CEO Steve Hunt said that this transaction will enable USPB to address the liquidity desires of its diverse producer ownership base, while maintaining its highly successful cattle supply system and a sizeable investment in beef processing.

"Leucadia is a diversified holding company engaged in a variety of businesses; its broad and deep experience will enhance our partnership. Our goals for the future of National Beef are aligned and we look forward to a long and successful partnership," Hunt said.

The transaction is subject to certain customary closing conditions and approval by the members of USPB and is likely to close by the end of 2011.

Leucadia said that it will fund the transaction through available cash and investments.

National Beef, based in Missouri, produces fresh and frozen beef, boxed beef, ground beef, branded boxed beef, case-ready beef, portion-controlledl beef and beef by-products for retailers, foodservice providers, distributors, further processors and the US military.

Its brands include Certified Premium Beef, Black Canyon Premium Reserve, Black Canyon Angus Beef, NatureSource Natural Angus Beef, Naturewell Natural Beef, Certified Angus Beef and Certified Hereford Beef.

A subsidiary of UPSB, National Beef has operations in Kansas, California, Pennsylvania, Georgia and Missouri, with a workforce of 9,100, and it reported sales of $6.8bn in fiscal 2011.

New York-based Leucadia, through its subsidiaries, engages in mining and drilling services, telecommunications, healthcare services, manufacturing, banking and lending, real estate and winery businesses.