U.S. clears China's Shuanghui to acquire Smithfield Foods

  @CNNMoney September 6, 2013: 6:45 PM ET
smithfield shuanghui

A customer selects a packet of ham sausages, supplied by Shuanghui, which controls China's largest meat-processing company

NEW YORK (CNNMoney)

U.S. officials have blessed the acquisition of Smithfield Foods by China's Shuanghui International, the companies announced Friday.

The deal is still subject to approval from Smithfield (SFD, Fortune 500) shareholders, who are scheduled to vote on it Sept. 24. If approved, it would be the largest acquisition of a U.S. company by a Chinese buyer.

Smithfield, the world's largest pork processor, announced its proposed acquisition by Shuanghui for nearly $5 billion in late May, saying it would open more of the Chinese market to Smithfield products at a time when pork consumption there is growing rapidly.

When a foreign entity seeks control of a U.S. company, the deal undergoes a detailed review by a government body called the Committee for Foreign Investment in the United States, or CFIUS, to assess any potential national security impact.

Related: China's expensive love affair with pork

"We are pleased that this transaction has been cleared by CFIUS, and we thank the Committee for its careful attention to this review," Smithfield CEO Larry Pope said in a statement Friday.

Shuanghui CEO Zhijun Yang said the two firms "have a long and consistent track record of providing customers around the world with high-quality food, and we look forward to moving ahead together as one company."

The deal has drawn criticism from some lawmakers and industry groups who have expressed concern about a Chinese company acquiring a major U.S. meat supplier.

Under the terms of the agreement, Smithfield would retain its existing brands and operate as a wholly owned subsidiary of Shuanghui. To top of page



Join the Conversation
CNNMoney Sponsors
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.