In a joint statement on Friday, Shuanghui International Holdings and Smithfield Foods Inc announced that the U.S. Committee on Foreign Investment gave its approval of the proposed acquisition of the Virginia-based pork producer and processor.
The acquisition valued at USD4.7 billion, would be the biggest purchase to date of a US firm by a Chinese company. The deal, which would also involve Shuanghui to absorb Smithfield's debt, would be awaiting approval from the shareholders in a special meeting on Septemeber 24. After the shareholder meeting, Shuanghui and Smithfield would be finalizing the deal shortly.
Earlier, the acquisition was also approved by the Committee on Foreign Investment in the United States (CFIUS). The inter-agency branch panel oversees foreign investments and check whether a certain investment is a potential threat to US security.
Although investor activist Starboard Value LP had expressed its disapproval over the merger, pundits say there would be no major investor move to block the acquisition.
Chief executive Zhijun Yang 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."
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