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    Categories: Legal News

Pilgrim’s Pride Enters Takeover Bid of Hillshire Brands

On Tuesday, a takeover bid of Hillshire Brands was launched by Pilgrim’s Pride, according to the Associated Press. Should the takeover occur, Pilgrim’s Pride would expand its offerings to include Jimmy Dean sausages and Ball Park hot dogs.

The offer, for $5.58 billion, could kill the plans of Hillshire to purchase Pinnacle Foods, which is the maker of Hungry Man frozen dinners, Birds Eye frozen vegetables and Duncan Hines cake mixes. Hillshire announced the expansion deal earlier in May, for $4.23 billion, so it could move into multiple areas of the supermarket business.

“As you are well aware, it has long been our desire to acquire the company,” Pilgrim’s said in a public letter to Hillshire CEO Sean Connolly.

Hillshire said it would review the proposal from Pilgrim as part of its fiduciary duties. It also said in a statement that the company strongly believes in “strategic merits and value creation potential” of the deal with Pinnacle Foods.

Pilgrim’s Pride is majority-owned by JBS, a Brazilian meat company. The deal is valued at $6.4 billion by Pilgrim’s Pride when debt is included in the numbers.

Ken Goldman, an analyst for J.P. Morgan, said the following in a note to investors: “Joining two protein companies makes a lot more sense than marrying a meat company with one that has a focus on frozen vegetables.”

Pilgrim’s Pride, which is headquartered in Colorado, said the deal could close by the third quarter of 2014. It also noted that it would pay the $163 million termination fee to end the deal with Pinnacle Foods.

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Jim Vassallo: Jim is a freelance writer based out of the suburbs of Philadelphia in New Jersey. Jim earned his Bachelor of Arts degree in Communications and minor in Journalism from Rowan University in 2008. While in school he was the Assistant Sports Director at WGLS for two years and the Sports Director for one year. He also covered the football, baseball, softball and both basketball teams for the school newspaper 'The Whit.' Jim lives in New Jersey with his wife Nicole, son Tony and dog Phoebe.

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