Oklahoma Farm Report masthead graphic with wheat on the left and cattle on the right.
Howdy Neighbors!
Ron Hays, Director of Farm and Ranch Programming, Radio Oklahoma Ag Network  |  2401 Exchange Ave, Suite F, Oklahoma City, Ok 73108  |  (405) 601-9211

advertisements
   
   
   
   
   
   

Agricultural News


Tyson Foods Seeks to Buy Out AdvancePierre in Merger Agreement with $4.2 Billion on the Table

Tue, 25 Apr 2017 14:43:27 CDT

Tyson Foods Seeks to Buy Out AdvancePierre in Merger Agreement with $4.2 Billion on the Table Tyson Foods Inc. and AdvancePierre Foods Holdings Inc. have entered into a definitive merger agreement pursuant to which a subsidiary of Tyson will launch a tender offer to acquire all of AdvancePierre’s outstanding common shares for $40.25 per share in cash, the companies announced in a joint press release.


The total value of the transaction, which has been approved by the boards of directors of both companies, is about $4.2 billion, including $3.2 billion in equity value and $1.1 billion in assumption of AdvancePierre debt. The offer price represents a 31.8 percent premium to AdvancePierre’s closing price on April 5, 2017, the most recent unaffected trading day, and a 41.6 percent premium to the company’s 60-day volume-weighted average trading price ending on April 5, 2017.


Funds affiliated with Oaktree Capital Management L.P., the private equity firm that owns about 42 percent of the outstanding shares of AdvancePierre common stock, have entered into a tender and support agreement pursuant to which those funds have agreed to tender their AdvancePierre shares pursuant to the tender offer.


Tyson President and CEO Tom Hayes said, “We are very pleased to announce this combination with AdvancePierre. The AdvancePierre leadership team has created significant value through the implementation of a new business management model, focus on quality and service and attention to the growth opportunities in convenience foods. The addition of AdvancePierre aligns with our strategic intent to sustainably feed the world with the fastest growing portfolio of protein packed brands.”


AdvancePierre President and CEO Christopher D. Sliva said, “We couldn’t be more delighted to join Tyson. This combination will allow AdvancePierre to accelerate its growth and broaden its distribution network by leveraging Tyson’s existing distribution infrastructure and go-to-market capabilities. Importantly, the transaction also offers compelling and certain value for our shareholders and will provide long-term benefits for our team members and customers.”


Among the benefits of the combination, the companies said, are that it:


- Joins market leaders with complementary product portfolios. AdvancePierre is a national producer of ready-to-eat lunch and dinner sandwiches, sandwich components and snacks, with product categories that are complementary to Tyson’s current offerings


- Furthers Tyson’s leadership in prepared foods segment. AdvancePierre’s product portfolio fits well with Tyson’s strategy to expand its fresh prepared foods offering for both out-of-home and in-home eating occasions. The collective portfolio of sandwiches, sandwich components, entrees and snacks will extend Tyson’s core strength into the fast-growing convenience and retail perimeter with solutions that span all-day parts. The Barber Foods brand of value-added chicken products has a strong heritage in both retail and foodservice channels and we look forward to building upon its foundation of quality.


- Enhances Tyson’s financial profile. The acquisition is expected to be immediately accretive to Tyson’s earnings per share on both a GAAP and cash basis, excluding one-time costs. Based on the most recent filings by both companies, the combined initial net debt to adjusted EBITDA ratio would be approximately 2.7x, which Tyson expects to be reduced steadily by its strong cash flow, including any divestiture proceeds, supporting Tyson’s commitment to its investment-grade credit profile.


- Creates significant cost and revenue synergies. Tyson expects the transaction will result in cost synergies of approximately $200 million, to be fully realized within three years. Cost synergies will be created by a consolidated manufacturing footprint, procurement efficiencies, distribution network consolidation, and addressing redundant sales and marketing functions and duplicative corporate overhead. Tyson also sees the opportunity to use high-quality raw materials from the fresh meats division to drive growth and efficiency.


The AdvancePierre deal comes a day after Tyson announced it was shedding three non-protein-related businesses.



Source - Meatingplace.com





   

 

WebReadyTM Powered by WireReady® NSI

 


Top Agricultural News

  • Monday, March 1, 2021 Market Wrap-Up with Justin Lewis  Mon, 01 Mar 2021 15:53:42 CST
  • Oklahoma Grain Elevator Cash Bids as of 2:00 p.m, Monday, March 1 2021  Mon, 01 Mar 2021 15:02:38 CST
  • 12 House Ways & Means Members Call on Treasury to Withdraw Section 199A Rules for Farmer Co-ops  Mon, 01 Mar 2021 12:35:17 CST
  • Optimism in Beef Industry Fueled by Strong Demand with Higher Prices Anticipated  Mon, 01 Mar 2021 11:46:22 CST
  • Dr. Derrell Peel on the U.S. Beef Export Situation and Update   Mon, 01 Mar 2021 11:39:16 CST
  • Governor Still Appoints Shelley Paulk to OK Tax Commission   Mon, 01 Mar 2021 11:31:54 CST
  • The Victor Ranch Receives Oklahoma Leopold Conservation Award  Mon, 01 Mar 2021 09:24:30 CST
  • USDA Announces Dr. Dewayne Goldmon as Senior Advisor, Racial Equity, and Andy Green as Senior Advisor, Fair and Competitive Markets  Mon, 01 Mar 2021 09:20:56 CST

  • More Headlines...

       

    Ron salutes our daily email sponsors!

    Oklahoma Ag Credit Oklahoma Farm Bureau National Livestock Credit Ag Mediation Program P&K Equipment Tulsa Farm Show AFR Insurance Stillwater Milling Oklahoma Cattlemen's Association KIS FUTURES, INC.

    Our Road to Rural Prosperity sponsors!

    Banc First OPSRC ORWA TPAOO TPAOO

    Search OklahomaFarmReport.com


       
       
    © 2008-2021 Oklahoma Farm Report
    Email Ron   |   Newsletter Signup   |    Current Spots   |    Program Links

    WebReady powered by WireReady® Inc.