Smithfield Shareholders Approve Shuanghui International Merger

SMITHFIELD, Va.Shareholders of Smithfield Foods, Inc. today voted to approve the acquisition of the company by Shuanghui International Holdings Limited. Smithfield, the world's largest pork processor and hog producer, anticipates closing the $7.1 billion deal on Sept. 26.

At a special meeting held today, roughly 96% of the votes cast supported the merger, constituting about 76% of Smithfield's total outstanding shares of common stock, the company said. Smithfield shareholders will receive $34 per share in cash for each share of Smithfield common stock they own. That price represented a premium of 31% to the closing price of Smithfield's common stock the day before the merger was announced on May 29.

Earlier this month, following a national security review, the Committee on Foreign Investment in the United States (CFIUS) approved the acquisition by Hong Kong-based Shuanghui International, removing a potential roadblock that could have killed the deal.

Under the acquisition, Smithfield will continue to operate under its existing brand names as a wholly-owned subsidiary of Shuanghui International, a leading pork producer in China.

"This partnership is all about growth, and about doing more business at home and abroad," C. Larry Pope, president and CEO of Smithfield, said today in a statement.

The merger is historic in that it represents the largest acquisition of an American company by a Chinese business, 15 senators wrote in a letter June 20 to Treasury Secretary Jacob Lew.

In recent years, Smithfield had considered various strategic options including a restructuring or break-up of the company, including spinning off its hog production segment, the company disclosed in regulatory filings.

In March, a major Smithfield shareholder Continental Grain Companysuggested the company should be split into three separate parts.  But Smithfield's board determined such an arrangement would not be in shareholders' best interests, Smithfield said.

Later that month, Smithfield learned that Shuanghui was interested in buying the company for $30 per share in cash. In April, a month before the merger was announced, Smithfield was still considering a variety of strategic operations including spinning off its hog production assets and a part of its fresh pork business.

Regulatory filings make clear that Smithfield had some concerns that CFIUS would delay or reject the deal.