NEW YORK (AP) — Pilgrim's Pride launched a takeover bid for Hillshire Brands on Tuesday that would expand its business beyond fresh and frozen chicken into a variety of packaged meats, including Ball Park hot dogs and Jimmy Dean sausages.
The $5.58 billion offer could derail Hillshire's plans to buy Pinnacle Foods, which makes Birds Eye frozen vegetables, Duncan Hines cake mixes and Hungry Man frozen dinners. Hillshire had announced the $4.23 billion deal earlier this month as a way to expand into different parts of the supermarket.
But Pilgrim's Pride says its offer of $45 per share for Hillshire is "substantially superior" and would allow the companies to cut costs by merging some operations and become a "protein leader" that sells more types of meat.
"As you are well aware, it has long been our desire to acquire the company," Pilgrim's said in a public letter to Hillshire CEO Sean Connolly.
In a statement, Hillshire said it continues to strongly believe in the "strategic merits and value creation potential" of its deal with Pinnacle Foods. The Chicago-based company said it would review Pilgrim's proposal as part of its fiduciary duties.
Pilgrim's Pride, which is majority-owned by Brazilian meat company JBS, wants to focus more heavily on branded products, which are more profitable than selling private-label meats to supermarkets and food-service outlets.
Hillshire, which has been struggling with weak sales, is looking for ways to boost its results, including by focusing on products like its Jimmy Dean breakfast sandwiches that aren't made up entirely of meat. Its shares were up nearly 23 percent to $44.43 in morning trading.
Continue reading this story on the...