Takeover reportedly largest to date of U.S. company by Chinese buyer

A Chinese company has acquired Hormel competitor Smithfield Foods, according to a Smithfield press release.

Smithfield announced Wednesday morning that Shuanghui International Holdings Ltd., also known as Shineway, will acquire the Smithfield, Va., based pork processor. The deal is reportedly worth $4.7 billion, or $34 per share, according to the New York Times. The company closed Tuesday at $25.97 per share and opened Wednesday at $32.40.

The Wall Street Journal said the move is the largest takeover to date of a U.S. company by a Chinese buyer. Smithfield — a $13 billion global food company and the world’s largest pork processor and hog producer — owns brands such as Farmland, Armour and John Morrell, according to its website, and has 46,000 employees.

Austin-based Hormel Foods Corp. — with sales of $8.23 billion in 2012 and roughly 20,000 employees — is in the process of expanding into China and other Asian markets, specifically with its Skippy peanut butter brand, which Hormel acquired in January, and its Spam products. The Times said the Smithfield purchase is designed to help that company expand into the Chinese market, too.

Shuanghui is China’s largest meat processing enterprise and the nation’s largest publicly traded meat company, according to Smithfield.

“We do not anticipate any changes in how we do business operationally in the United States and throughout the world,” Smithfield President and CEO C. Larry Pope said in the release. “With our shared expertise and leadership, we look forward to accelerating a global expansion strategy as part of Shuanghui.”

Smithfield said there will be no closures at the company’s facilities, Smithfield’s headquarters will stay in Virginia, and its existing management team will remain.

The transaction, expected to close in the second half of 2013, is subject to approval by Smithfield’s shareholders and The Committee on Foreign Investment in the United States.

Hormel declined to comment.