Hillshire shares surge on takeover bid from Pilgrim's

May 27, 2014: 11:54 AM ET
Food fight! Merger mania in the kitchen
NEW YORK (CNNMoney)

Shares for meat producer Hillshire Brands surged Tuesday after rival Pilgrim's Pride made a takeover bid to buy the company for $6.4 billion.

Hillshire Brands (HSH) jumped more than 20%. Shares for Pilgrim's Pride (PPC) also rose, by 3%.

Under the proposal, Pilgrim's Pride would pay $45 a share for Hillshire in an all-cash deal.

Hillshire said in a statement that it was open to the bid from Pilgrim's, a seller of chicken products.

"Consistent with its fiduciary duties, and in consultation with its independent financial and legal advisers, Hillshire Brands' Board will thoroughly review the Pilgrim's Pride proposal," the company said.

Earlier this month, Hillshire Brands -- the parent of such meat products as Hillshire Farm and Jimmy Dean sausage -- agreed to acquire Pinnacle Foods (PF), the maker of Birds Eye frozen vegetables and Duncan Hines cake mix.

Hillshire indicated in its statement that it is still interested in buying Pinnacle.

"We continue to strongly believe in the strategic merits and value creation potential provided by the proposed transaction with Pinnacle Foods." Hillshire said.

Representatives for Pilgrim's and Pinnacle were not immediately available for comment.

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