Poultry producer Sanderson Farms is exploring a sale with potential buyers that include the parent company of competitor Wayne Farms, according to a report in the Wall Street Journal.
Sanderson, the third largest U.S. poultry processor behind Tyson Foods and Pilgrim’s Pride, has hired investment firm Centerview Partners to advise on the sale, the Journal reports. One of the reported suitors is Continental Grain Co., which owns Wayne Farms. A merger would establish a company with about a 15% share of the American chicken market; Pilgrim’s, the No. 2 company, is at 16%.
Sanderson acknowledged receiving a bid last October from Durational Capital, which it rejected as too low. Tyson Foods was reported to be behind that offer, but Sanderson never officially confirmed that.
Sanderson Farms had $3.56 billion in sales in 2020, a 3.6% increase from 2019. The Journal estimates its market value at $3.5 billion.