NEW YORK -- Chicken producer Pilgrim's Pride (IW 1000/527) on Tuesday announced a bid to acquire frozen-foods company Hillshire Brands (IW 1000/875) in a deal worth $6.4 billion.
Pilgrim's offer would require Hillshire to abandon its own $6.6 billion deal announced May 12 to acquire Pinnacle Foods, which owns the Duncan Hines and Mrs. Butterworth's brands.
Pilgrim's said the deal with Hillshire, which markets sausage and other prepared meats under the Hillshire Farm logo, was "substantially superior" to the pending Hillshire-Pinnacle deal and would combine strong marketing and operational advantages.
"We believe that together Pilgrim's and Hillshire will better serve our combined customer bases for the benefit of all our stakeholders," said Bill Lovett, chief executive of Pilgrim's Pride. "We look forward to working constructively with Hillshire to sign a definitive merger agreement and quickly realize the benefits of this combination."
Pilgrim's said its offer of $45 per share for Hillshire amounted to a 25% premium over the average trading price of Hillshire in the 10 days prior to its bid for Pinnacle.
Pilgrim's Pride said it would pay a $163 million termination fee to end the deal between Hillshire and Pinnacle.
Copyright Agence France-Presse, 2014
