Food Processing - August 2008 - (Page 14)

news bites M E R G E R S & ACQ U I S I T I O N S tyson sells canadian operation, buys into india t yson Foods Inc., Springdale, Ark., signed a letter of intent to sell the packing, feedyard and fertilizer assets of Lakeside Farm Industries Ltd. and its subsidiary, Lakeside Packers, to XL Foods Inc., a Canadian beef processing business, for C$107 million. Richard Bond, Tyson president/CEO, called Lakeside, based in Brooks, Alberta, “one of the premier beef processing operations in Canada,” but said it “no longer fits the long-term strategy of our company, as our current international strategy is focused primarily in Asia, Mexico and South America.” XL is part of the Nilsson Bros. Group, a Canadian cattle feeding, marketing and meatpacking business. Days later, Tyson announced it had acquired majority ownership of Godrej Foods Ltd., Mumbai, India, one of that country’s leading poultry processors, according to Tyson. “India has a population of more than 1.1 billion people, and while per-capita chicken consumption there is currently less than 5 lbs. a year, its annual growth rate of more than 10 percent is among the highest in the world,” said Rick Greubel, group vice president and international president for Tyson Foods. The joint venture will be called Godrej Tyson Foods, with Tyson having 51 percent ownership. Annual sales are expected to approximate $50 million. M E R G E R S & ACQ U I S I T I O N S china-based cofco buys 5 Percent of smithfield s mithfield Foods Inc., Smithfield, Va., on June 30 struck a deal to sell 7 million shares, or 4.95 percent of the company’s common stock, to Cofco Ltd., China’s largest national agricultural trading and processing company. Smithfield expects to close promptly on an initial $63.1 million of the share purchase, with the remainder coming after a Hart-Scott-Rodino antitrust review. The company plans to use the proceeds of the sale to repay indebtedness and for other general corporate purposes. Cofco is owned by the government of the People’s Republic of China and has substantial business interests in food and beverage production, commercial and residential real estate, hotel operations, financial services and packaging. C. Larry Pope, Smithfield’s president/CEO, said of Cofco, “We have been working closely together and this investment represents a significant step in cementing our relationship for the long term. “China is experiencing rapid growth in pork consumption and consumes more pork than the rest of the world combined,” Pope continued. “Cofco has introduced Smithfield to many opportunities in China, and we look forward to continue working together.” Gaoning Ning, chairman of Cofco, added, “Smithfield is the world’s largest producer and processor of pork. We look forward to building on our existing commercial relationship and exploring growth opportunities in China’s food industry together.” In connection with the sale, Smithfield has agreed to nominate Ning for election as a director at its 2008 annual shareholders meeting. Cofco’s investment in Smithfield is passive in nature and the purchase agreement contains standstill provisions. FoodProcessing.com 14 • Food Processing August 2008 http://www.kemcosystems.com http://www.kemcosystems.com http://foodprocessing.com

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Food Processing - August 2008 Contents Editor’s Plate NewsBites Special Report Rollout Food Biz Kids The Top 100 Ingredients Show Report Plant Operations MRO Q&A Case History New Supplier Products Toops Scoops

Food Processing - August 2008

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