Smithfield, Shuanghui International Merger Gets US Panel Clearance

(RTTNews) - Smithfield Foods, Inc. (SFD) and Shuanghui International Holdings Limited have received clearance from the Committee on Foreign Investment in the United States or CFIUS on their proposed transaction. The parties have also received governmental merger clearance in Ukraine.

It was in late May that Smithfield entered into a definitive merger agreement with Shuanghui that values the pork processor at $7.1 billion, including the assumption of its net debt. The transaction is expected to close in the second half of 2013.

Smithfield shareholders will receive $34.00 per share in cash for each share of Smithfield. After consummation of the transaction, Smithfield will continue to operate under its existing brand names as a wholly owned subsidiary of Shuanghui.

The transaction remains subject to Smithfield shareholder approval and some other customary closing conditions.

Smithfield's shareholders are scheduled to vote on the transaction at a special meeting on September 24. Shuanghui and Smithfield expect the transaction to close shortly thereafter.

Zhijun Yang, CEO of Shuanghui, said, ""This transaction will create a leading global animal protein enterprise. Shuanghui International and Smithfield have a long and consistent track record of providing customers around the world with high-quality food, and we look forward to moving ahead together as one company."

Smithfield reported lower first-quarter profit on Friday, amid normal seasonal weakness in fresh pork and declines in key export markets. However, the firm said that despite the lackluster first quarter, it remains very optimistic about future.

SFD closed at $33.92 on Friday.