Smithfield Foods completes $4.7bn merger with China’s Shuanghui

Smithfield Foods, a US-based pork producer and processor, has completed its $4.7bn merger with China’s Shuanghui International, after Smithfield Foods’ shareholders gave their approval on 24 September.

This development reportedly marks the largest ever takeover of a US company by a Chinese firm.

Shuanghui chairman Wan Long said, "Today marks an exciting new chapter for both of our proud organisations as we formally begin a partnership that will benefit our customers, employees, producers and partners."

"Together we look forward to utilising our individual strengths, including Shuanghui’s extensive distribution network in China and Smithfield’s leading production and safety protocols, to provide safe, high-quality products to consumers worldwide," Long added.

Smithfield president and CEO C. Larry Pope said, "Our partnership ensures the stability of our business for all our stakeholders, particularly our employees and the communities we serve, while simultaneously unlocking exciting opportunities for growth in the large and rapidly growing Chinese pork market."

Smithfield Foods will continue to operate with its existing brand names as a wholly-owned subsidiary of Shuanghui International, while its common stock has ceased to be publicly traded on the New York Stock Exchange.

Shareholders will receive $34 for each share of common stock they own in Smithfield.

Morgan Stanley provided financial advisory services to Shuanghui International, while Barclays acted as financial advisor to Smithfield.

Headquartered in Hong Kong, Shuanghui seeks to expand Smithfield’s pork sales in China, Japan, Australia, South Korea and Europe through its distribution network.

In the coming weeks, Shuanghui will announce the details of new pork products made of meat produced in the US, aiming at the growing Chinese middle class segment, reported The Wall Street Journal.

The Chinese firm has also announced plans to cut down its stake in Spanish packaged meats firm Campofrio to less than 30% within three months from the 37% it gained through the latest deal.

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Image: Smithfield Foods will continue to operate with its existing brand names as a wholly-owned subsidiary of Shuanghui International. Photo courtesy of antpkr.