Cargill, Continental Grain to acquire poultry firm Sanderson Farms for $4.5bn
Cargill and Continental Grain Company have agreed to jointly acquire publicly-listed Sanderson Farms for $4.53 billion with an aim to create a top US poultry company.
Sanderson Farms produces fresh, frozen, and minimally prepared chicken.
As per the offer, shareholders of Sanderson Farms will be paid $203 per share in cash, a 30.3% premium to its unaffected share price of $155.74 on 18 June 2021.
Following the closing of the deal, Cargill and Continental Grain will merge Sanderson Farms with Wayne Farms, the latter’s subsidiary, to establish a new, privately held poultry business.
The combination of Sanderson Farms and Wayne Farms is expected to have high-quality asset base, operating cultures that are complementary, and an industry-leading management team and employees.
Joe Sanderson — Chairman and CEO of Sanderson Farms said: “We are proud to be joining with Cargill and Continental Grain and we are confident that they will be strong stewards of the Sanderson Farms team, brand and assets going forward.
“As part of the newly created company, Sanderson Farms and its new owners will remain committed to the employees, poultry producers, customers, communities, environment, and animals under our care, and to continuing to deliver the highest quality products and the best service in our industry to our customers.”
The new poultry company to be led by Wayne Farms CEO Clint Rivers will be well poised to improve its service to customers in retail and food service and bring in organic growth, said Cargill. It will have state-of-the-art operations that include poultry processing plants and prepared foods plants in Alabama, Georgia, Arkansas, Mississippi, Louisiana, North Carolina, and Texas.
David MacLennan — Chairman and CEO of Cargill said: “At Cargill, we are committed to nourishing the world in a safe, responsible and sustainable way.
“Expanding our poultry offerings to the U.S. is a key enabler of our ability to meet customer and consumer demands. With these great businesses, and our strong partnership, we believe we will deliver a superior portfolio of products and services to our customers.”
The deal, which is subject to regulatory approvals, Sanderson Farms stockholder approval, and other customary closing conditions, is anticipated to close by the year-end or early 2022.