A day after Pilgrim's Pride made public its bid for Hillshire Brands Co., Tyson Foods Inc. made a slightly better offer, $50 per share, $6.8 billion in total, for the Chicago-based wiener and deli meats company. This offer, too, would require a cancellation of Hillshire's pending acquisition of Pinnacle Foods.
Pilgrim's Pride's offer, which had the backing of its 75-percent owner JBS, was for $6.4 billion. It was made public May 27. (See our reporting Pilgrim's/JBS Makes $6.4 Billion Offer for Hillshire).
"The combination of Tyson and Hillshire would reposition Tyson as a clear leader in the retail sale of prepared foods, with a complementary portfolio of well-recognized brands and private label products, including Tyson, Wright Brand, Jimmy Dean, Ball Park, State Fair and Hillshire Farm," said the Tyson announcement. "In particular, we believe that the strength of Hillshire’s products in the breakfast category would allow Tyson to capture opportunities from shifting consumer trends in this attractive and fast-growing daypart where Tyson has little presence today."
“We believe that there is a strong strategic, financial and operational rationale for the combination of Tyson and Hillshire,” added Donnie Smith, Tyson Foods' president/CEO. “Our proposal provides Hillshire shareholders with an immediate cash premium for their shares that we believe is both greater and more certain than what can be attained in the near term by the company either on a standalone basis or in combination with any other food processing company.”
Smith also called the deal an "extraordinary strategic fit."
Will anyone else join the fray? Watch our website for further developments.