U.S. clears Smithfield’s acquisition by China’s Shuanghui
(Reuters) – The U.S. Committee on Foreign Investment has cleared the way for Shuanghui International Holdings Ltd’s proposed $4.7 billion acquisition of Smithfield Foods Inc.
The deal, which would be the biggest purchase of a U.S. company by a Chinese firm, still needs shareholder approval at a special meeting scheduled for September 24.
Shuanghui and Smithfield expect the transaction, valued at $7.1 billion including debt, to close shortly after that meeting.
Experts in Washington and on Wall Street had expected the deal to get the nod from the Committee on Foreign Investment in the United States (CFIUS), an inter-agency executive branch panel that examines foreign investment for potential threats to national security.
They also do not expect a move by a major investor to block the deal.
Activist hedge fund Starboard Value LP, which has a 5.7 percent stake in Smithfield, is searching for an alternative buyer for Smithfield and has said it would vote against the merger.
Shuanghui’s bid, which aims to satisfy China’s growing appetite for pork, stirred concern about food safety and domestic pork supplies among some U.S. politicians and faced review by a committee of several government agencies overseen by the Treasury Department.
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