US-based Tyson Foods has submitted an offer to acquire packaged foods company Hillshire Brands in an all-cash deal of $6.8bn.
Tyson's offer of $50.00 per share in cash is expected to provide Hillshire shareholders with an immediate return on their investment, and a significantly superior alternative to Hillshire's previously announced deal to buy Pinnacle Foods.
The proposed deal will strengthen Tyson's position in retail sale of prepared foods, with a complementary portfolio of major brands and private label products, including Tyson, Wright Brand, Jimmy Dean, Ball Park, State Fair and Hillshire Farm.
Tyson Foods president and chief executive officer Donnie Smith said that the company believes that there is a strong strategic, financial and operational rationale for the combination of the two companies.
"Our proposal provides Hillshire shareholders with an immediate cash premium for their shares that we believe is both greater and more certain than what can be attained in the near term by the Company either on a standalone basis or in combination with any other food processing company," Smith added.
According to Tyson, the proposed transaction will be accretive to EPS in the first full year after completion.
Earlier this week, US-based chicken producer Pilgrim's Pride has submitted a bid to buy Hillshire Brands in a $6.4bn deal. In response to the offer, Hillshire said its board will thoroughly review the Pilgrim's Pride proposal, in line with its fiduciary duties, and in consultation with its independent financial and legal advisors.
Image: The proposed deal will strengthen Tyson's position in retail sale of prepared foods. Photo: courtesy of KEKO64/FreeDigitalPhotos.net.
