JBS offers to buy Moy Park for $1.5 billion

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  Bigstock

  JBS has offered to purchase poultry company Moy Park from Marfrig for a price of $1.5 billion.

  From WATTAgNet:
  Brazil-based meat and poultry company JBS has agreed to buy European poultry company Moy Park from Brazilian competitor Marfrig for a price of about $1.5 billion.
  The proposed transaction will involve a $1.19 billion investment from JBS for the acquisition, with another $318 million being invested to take on Moy Park’s current debt. The deal is subject to regulatory approval.
  The news of the proposed acquisition comes one month after JBS CEO Wesley Batista said the company will “for sure” be looking at potential acquisitions in the chicken and pork sectors, as well as the packaged food sectors. That statement was a direct departure from comments Batista made during the JBS quarterly earnings call on March 11, when he said the company would not pursue acquisitions in 2015, but would instead seek organic growth.
  Moy Park, whose key product categories include chicken, turkey, broiler hatching eggs, feed sales and beef, processes 234 million birds annually, according to the WATTAgNet Top Poultry Companies Database. It has 4 processing plants and 6 further processing plants.
  Moy Park has been in a state of expansion in recent months, as it announced plans to complete at least 250 new poultry houses in Northern Ireland. In addition to Northern Ireland, Moy Park also produces and processes poultry in Ireland, England, the Netherlands and France.

Cooper: Perham purchase will help egg division diversify

Cooper Farms’ decision to team with Weaver Brothers to purchase the Perham Egg facility in Fort Recovery, Ohio, will be a good move for the company as it seeks to expand and diversify its egg division, Cooper Farms Chief Operating Officer Gary Cooper said on December 5.
The two companies jointly purchased Perham Egg, a new facility that was owned by North Central Equity LLC. With the purchase, the two companies have taken the initials from both businesses and formed a new joint venture company, CW Egg Products.


Cooper Farms growth in egg industry
Cooper Farms is best known for its farm-to-fork turkey operations, but it is also active in the egg, pork and feed businesses. And while Cooper Farms has been in the egg business for years, Cooper described its egg division as “somewhat of a sideline business for us.”
“We finally decided about a year ago that we either needed to get bigger and get more diversified in that business or actually get out of it,” said Cooper.
On August 8, Cooper Farms purchased Fort Recovery Equity, an egg layer and pullet operation also in Fort Recovery. With that purchase, Cooper Farms gained not only an inline egg processing operation, but also 42 contract growers and a feed mill.
But Cooper knew the company did not want to stop there.
“The main thing left that we saw was some form of liquid egg operation,” he said.
Cooper Farms visited with the management of Weaver Brothers and explored a couple of options, Cooper said. Then, when Perham Egg became available for acquisition, the two companies continued to hold talks, eventually reaching an agreement for a 50-50 purchase of Perham Egg.
“Jim Weaver at Weaver Brothers has a whole lot of knowledge of the egg business and its history, and we’re really excited to be able to work with him,” said Cooper.


Cooper Farms’ egg division to follow turkey division model
When Cooper Farms sought to grow its egg division, it also wanted to diversify it and add to its value-added product line. It is a business strategy that has served the Cooper Farms turkey division well.
Cooper Farms value-added products include sliced meats, turkey burgers, and turkey roasts, appealing to a wider variety of consumer choices. The company now seeks to do the same with eggs, as it aspires to offering a more diverse mix of value-added egg products.
“From that, we’ve learned the whole value-added process and how much that’s worth. That’s where we’re really headed with this,” said Cooper.

Koch Foods CEO has eye on acquisitions

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  Andrea Gantz

  Poultry company Koch Foods could grow, as its CEO Joe Grendys says he would like to acquire more companies.

  From WATTAgNet:
  Joe Grendys, CEO and majority owner of privately-held poultry company Koch Foods, is pleased with the success of the poultry company. But he would like to see the company to grow through acquisitions.
  That growth may not necessarily be through buying more poultry companies. He told the Chicago Tribune that other animal proteins are also being considered.
  "I want to acquire more" companies, Grendys said. "I definitely have our hook in the water, but right now the industry is performing well. So there aren't a lot of fish biting. But I could see us branching out in the next three to five years possibly into another protein; not sure what that protein would be yet."
  Listed No. 261 on the Forbes list of the 400 richest Americans, Grendys leads the company that operates in six states and processes the chicken for Wal-Mart’s "Great Value" Buffalo wings, chicken strips, chicken tenders and popcorn chicken. The company also processes the chicken nuggets sold at Burger King and other private-label brands at grocery stores, such as Kroger and Aldi. None of those products carry the label “Koch Foods.”
  Koch Foods, headquartered in Chicago, processes 624 million birds annually, according to the WATT Global Media Top Companies Database.

Tyson bids $8.55 billion for Hillshire; Pilgrim’s withdraws bid

Tyson Foods, under the leadership of president and CEO Donnie Smith, has submitted a new bid to purchase Hillshire Brands. The new offer is valued at about $8.55 billion.

 
Tyson Foods has increased its bid for Hillshire Brands, prompting bidding rival poultry processor Pilgrim’s to retreat after a bidding battle that began May 27. Tyson’s latest offer is to acquire all outstanding shares of Hillshire Brands for a price of $63 per share in cash for a total of approximately $8.55 billion.
The combination of Tyson and Hillshire Brands would reposition Tyson as a clear leader in the retail sale of prepared foods, with a complementary portfolio of well-recognized brands, including Tyson, Wright Brand, Jimmy Dean, Ball Park, State Fair and Hillshire Farm. In particular, the strength of Hillshire Brands' products in the breakfast category would allow Tyson to capture opportunities in this fast-growing market.
"The Hillshire Brands acquisition would represent a defining moment for Tyson Foods," said Donnie Smith, Tyson's president and CEO. "Our strategy has been to grow our prepared foods business, and it has been our aspiration to be a leader in retail prepared foods just as we are in chicken. Now we will have those iconic No. 1 and No. 2 brands in numerous categories."
"Tyson Foods has a history of growing through strategic acquisition," added John Tyson, chairman of the Tyson Foods board. "It is the view of the board of directors that this is truly a transformational opportunity and one that best fits with our strategic plan while enhancing our margins and creating long-term shareholder value." The Tyson family and the board are prepared to issue shares to maintain the company's investment grade credit rating.
Meat and poultry processor Tyson Foods’ latest proposal to purchase Hillshire Brands, like the previous bids submitted by Tyson and Pilgrim’s, is subject to Hillshire Brands being released from its existing agreement to acquire Pinnacle Foods.
Hillshire considering Tyson offer
Hillshire Brands, in a statement posted on its website, stated that it has not yet accepted Tyson’s latest offer and for now remains committed to its plans to purchase Pinnacle Foods, which has a portfolio that includes the Armour, Hungry-Man, Vlassic, Van de Kamp’s, Duncan Hines and Aunt Jemima brands.
“The Hillshire Brands board of directors has not approved the Tyson Foods offer, has not changed its recommendation regarding the Pinnacle merger, and is not making any recommendation with respect to the Tyson offer,” Hillshire Brands stated. “Hillshire Brands does not have the right to terminate the merger agreement with Pinnacle Foods on the basis of the Tyson Foods offer or enter into an agreement with Tyson Foods prior to its termination. There can be no assurance that any transaction will result from the Tyson Foods offer.”
Pilgrim's backs out of bidding war
Tyson’s latest purchase offer follows its earlier proposal to purchase Hillshire Brands for $50 per share in an all-cash offer valued at $6.8 billion. That offer was made on May 29, two days after Pilgrim’s offered to buy Hillshire for $45 per share or $6.4 billion. Pilgrim’s upped its bid to $55 per share or $7.7 billion on May 3, but after the latest proposal from Tyson, has withdrawn from the bidding.
"As a disciplined acquirer, we determined that it was in the best interests of our shareholders not to increase our proposed price of $55 per share in cash," said Bill Lovette, Pilgrim's CEO. "Pilgrim's will maintain its strong focus on operational excellence and shareholder value, while pursuing acquisition opportunities that advance our stated strategy. We appreciate the support of our shareholders, customers and team members throughout this process."
Should Hillshire Brands accept Tyson’s $8.55 billion offer, the transaction would be funded by cash on hand and a fully committed bridge facility from Morgan Stanley Senior Funding and JP Morgan Securities LLC. Tyson expects to maintain its investment grade credit rating and is prepared to issue debt and equity as is prudent. Tyson anticipates the substantial cash flow from the combined companies will enable it to rapidly pay down debt.
Tyson’s latest offer was unanimously approved by the board of directors of Tyson Foods. The offer will remain in effect until December 12, the final termination date of the Hillshire Brands/Pinnacle Foods agreement. If that agreement is terminated in accordance with its terms, Hillshire Brands would be able to accept the offer, with the result that binding definitive agreements could become effective. Any transaction would be subject to regulatory approval and other customary closing conditions.

Post Holdings' acquisition of Michael Foods completed

Post Holdings Inc. completed its acquisition of Michael Foods, a leading producer of eggs and value-added food products, effective June 2. The acquisition, initially announced on April 17, is valued at $2.45 billion.
Post Holdings, a company most widely known for its line of breakfast cereals, also announced it closed its previously announced senior notes offering and senior secured term loan facility simultaneously with the closing of the Michael Foods acquisition. The company's previously announced common stock and tangible equity units offerings closed on May 28.
Michael Foods’ recognized brands include Papetti’s, Crystal Farms, AllWhites, Simply Potatoes, Abbotsford Farms and Eggland’s Best (under license).
Prior to the acquisition, Michael Foods, was owned by a group that includes affiliates of GS Capital Partners, affiliates of Thomas H. Lee Partners, and other investors.

Food industry mergers, acquisitions steady in 2013; retail deals surge

The hesitation of the food industry to engage in new merger activity was still evident in 2013, with only 311 deals, roughly the same as in 2012, according to the Food Institute's "Food Business Mergers & Acquisitions 2013."
Published annually by the Food Institute, this book contains analysis of the transactions that occurred throughout the year in over 25 different categories including food processors, restaurants, retailers, investment firms and banks and foodservice distributors. The specifics of each of the deals that took place in 2013, plus analysis of mergers and acquisitions (M&A) activity by category, provides valuable insight into one of the most important aspects of the food industry.
While the food industry may have seen declines in merger activity overall, the retail category was increasingly busy. Retailers made up 13 percent of all food industry mergers in 2013, in large part because of the exceptional year that supermarkets had. This year there were the most supermarkets mergers and acquisitions since 2007, and nine more deals than in 2012. And with talk of leading supermarket chains, such as Safeway, considering sales, this trend may well continue.
Food processors again completed the most deals in the food industry in 2013, making up 34 percent of the overall industry mergers and acquisitions. This category grew 27 percent from 2012 to 105 total deals in 2013. Within this group, dairy, meat and "other" processors saw considerable growth, with the dairy industry doubling mergers from 2012.
Investment firms and banks were the second most active group, acquiring 47 food companies, including Berkshire Hathaway and 3G Capital's purchase of H.J. Heinz Co, one of the largest food industry acquisitions ever. Another massive food industry merger came in the foodservice category: Sysco Corp.'s proposed acquisition of US Foods. This merger could mean a big change in foodservice, and represents the large impact that mergers and acquisitions can have on the industry.
The food industry mergers and acquisitions future seems to be looking up, but overall growth is uncertain. Some industries and categories have seen increases in activity, while others see just as much decline. The rise in mergers and acquisitions has still not reached levels similar to 2008 and prior years, but has been steadily increasing since the stark decline in 2009.
The "Food Business Mergers & Acquisitions 2013" study recaps these deals, as well as many others, that were completed or left open at the end of the year, while also providing an outlook into 2012 and beyond. Alongside balance sheets and multiples charts, this publication offers information that can put a potential deal into better focus or provide a unique perspective with records of similar mergers.

GNP Company to be acquired by pork producer The Maschhoffs

The Maschhoffs, the largest family-owned pork production company in North America, and GNP Company, a leading Midwestern provider of premium quality chicken, have signed a definitive agreement where The Maschhoffs will acquire GNP Company and its subsidiaries. The companies announced the planned acquisition on November 22.
GNP Company, which produces chicken under the Gold'n Plump, Just BARE and Sunny Roost brand labels, and The Maschhoffs' pork production business will operate as separate business units following the closing of the transaction. The transaction will have no immediate impact on GNP Company's chicken business or The Maschhoffs' pork production business.
GNP Company's headquarters will remain in St. Cloud,, Minn., and its nearly 1,700 team members and 350 family farm partners will be retained. Based in Carlyle, Ill., The Maschhoffs is owned by fifth generation family members Dave and Karen Maschhoff and Ken and Jule Maschhoff. The Maschhoffs partners with more than 450 family farmers across the Midwest to produce enough pork to feed more than 16 million consumers annually.
"No changes in business operations or company commitments are planned as a result of this acquisition," stated Mike Helgeson, GNP Company CEO and third-generation leader. "GNP Company will continue to build on its reputation as the Midwest's leading provider of premium quality chicken brands and products."
Meanwhile, The Maschhoffs' pork production business unit will continue to dedicate its energies to maintaining and enhancing its position as North America's leading pork production company. "Our intent is to manage GNP Company as a separate business unit next to our current pork production business," said Jason Logsdon, The Maschhoffs CEO. "GNP Company will continue to be led by its present management team, with the support of its current team members and contract growers."
The transaction provides the capital and long-term resources that GNP Company needs to grow to meet increasing sales demand for its products and brands. GNP Company sales are expected to be about $400 million in 2013. "For the past year, our facilities have been running at capacity with more demand on the horizon," Helgeson said.
 "By joining forces, we can leverage our core strengths, capitalize on growth opportunities, and create new value in the marketplace-thus making the combined company stronger than each would be separately," said Logsdon, adding that the transaction makes new resources available to both companies. "This gives each business unit the opportunity to take advantage of growth opportunities that will help make us all more successful. Over time, the companies will share best practices, leverage select strategic shared resources, and benefit from the balance sheet strength of an organization that is diversified across multiple proteins."
"Our overall goal is to continue to grow both the pork and chicken businesses while enhancing our ability to meet the needs of our valued customers and of a growing population," Logsdon continued.
Helgeson added it was important to him to find a partner with like-minded values and culture as well as a strong commitment to growth. "This is a win-win from both the business and organizational standpoints," he explained, "one that provides the critical resources for growth and secures a strong future for all of our team members and growers."
The Maschhoffs and GNP Company share a deep commitment to family values, quality, market innovation and customer service excellence. Other values the companies share are their stewardship efforts to minimize their environmental footprints; dedication to the well-being and safety of animals; and a commitment to people and the communities where they live, work and raise their families.

Inghams poultry firm purchased by TPG Capital

U.S. private equity firm TPG Capital has purchased the assets of Australia’s largest poultry firm Ingham Enterprises.
Bob Ingham, the sole shareholder of the company, confirmed the sale in a statement on March 9, Reuter’s reported, but he did not disclose the amount it sold for. TPG beat several other bidders in the auction to acquire the Ingham assets, with U.S. private equity firm Blackstone Group LP believed to have been a leading contender. Other possible bidders named included Chinese agribusiness giant New Hope and New Zealand’s Affinity Equity Partners.
Bob Ingham, sole shareholder of the company that owns the Ingham Chicken brand, put the poultry producer up for sale in July 2012. Ingham Enterprises was advised by Investec Bank and TPG was advised by Macquarie Capital.
Ingham said he does not anticipate the business will change much under the new ownership.
"An important part of the decision for me was finding a buyer who would ensure that our customers will continue to receive the highest level of service and our employees would be well looked after," Bob Ingham said.
Inghams has been one of Australia’s most successful privately owned businesses. It was founded in 1918 by Bob Ingham’s father, who set up a small chicken farm in bush land on Sydney’s western fringe. Bob Ingham and his late brother Jack inherited the business in 1953, when the farm had 650 pigs and 30,000 birds.

Poultry producer Inghams poised for sale as final bids submitted

Final bids have been placed for the sale of Inghams Enterprises, one of Australia’s biggest poultry producers.
According to sources, the bids entered place the value of the company around $821 million. Companies named as bidders include U.S. private equity groups TPG Capital and Blackstone Group, Chinese agribusiness giant New Hope and New Zealand’s Affinity Equity Partners. Blackstone had reportedly removed itself from the bidding process in December 2012, saying the asking price was too high.
It was announced in July 2012 that Inghams would be up for sale, with information going out in September and initial bids submitted in October.
The sole shareholder of Inghams Enterprises is Bob Ingham. The firm was founded by his family in 1918 with a rooster and six hens. Since then, Bob Ingham and his brother Jack, have guided it to become a leading Australian poultry firm. Jack Ingham died in 2003, leaving Bob as the only shareholder.
Investec Bank (Australia) Limited was appointed to manage the process of finding a buyer.

Family trust backs off of Zacky Farms purchase

The Robert D. and Lillian D. Zacky Trust, who in late January revealed plans to purchase the majority of Zacky Farms’ assets, has evidently backed out of the pending deal, paving the way for Pitman Family Farms to become the new owner of the vertically-integrated poultry production company.
The family trust provided a $71 million loan to keep afloat the poultry processor that bears the family name. The trust originally submitted the winning $31.6 million bid for the Zacky Farms assets after the company’s October bankruptcy filing.
But new bankruptcy court documents filed show the trust backing out. So the company will ask the court to go with the backup bid from Pitman Family Farms, which offered up to $32.1 million.
According to its bid, Pitman, which sells its products under the Mary's Free Range Chickens brand, didn't plan to rehire Zacky's 1,500 workers in operations in Fresno, Tulare, Kings, San Joaquin and Los Angeles counties, the Fresno Business Journal reported. Pitman has asked for additional time to close to sale until February 15, which would require The Robert D. and Lillian D. Zacky Trust to fund operations until that time.
Pitman Family Farms is a third-generation poultry company that originated in 1954. It is based out of Sanger, Calif.

Investor Endless negotiating to acquire Vion's poultry division

Investor Endless is in talks to acquire Dutch food group Vion's poultry business, after previously purchasing the company's pork division, according to reports.
Endless is in competition with Ranjit Boparan’s 2 Sisters Food Group and Sun European Partners, but its previous acquisition from Vion may give it an advantage. The company is also looking into acquiring Vion's red meat division, which has cattle and lamb interests in Scotland, Wales and the South West of England.
Vion plans to leave the UK entirely so it can focus on its core food activities in the Netherlands and Germany and on its global ingredients business.