One of the biggest shareholders in Smithfield Foods Inc, Continental Grain Co has urged the meat company to add three new directors to its existing board. The motion is but part of the restructuring plan that can help boost share values of Smithfield to US$40 in the next three years.
The recommendation was made through a presentation filed last Thursday with US securities regulators. Here, Continental reiterated its position that Smithfield should split the conglomerate into three separate companies. It also urged the use of sale proceeds to buy back shares as well as prepare a competitive dividend plan at par with its peers.
The recommendation to break up the company into three separate entities was made last April 1, allowing for a corporation each to manage hog production, international business as well as the packaged meats business, Smithfield responded that the break up would make the company less competitive.
Continental in response to Smithfield's answer, said the reply was 'inadequate and a continuation of an unacceptable status quo.'
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