SAN FRANCISCO (Thomson Financial) - Smithfield Foods Inc. said Wednesday
Groupe Smithfield Holdings S.L., its 50/50 joint venture with investment funds
controlled by Oaktree Capital Management LLC, is engaged in merger talks with
Campofrio Alimentacion S.A., the largest processed meats company in Spain.
Smithfield said that if the merger takes place as currently under
consideration, Campofrio would issue shares to Smithfield and Oaktree in
exchange for all of the membership interests in Groupe Smithfield.
Smithfield, which currently owns 24% of Campofrio, would own 36% of the
combined company after the merger.
Groupe Smithfield and Campofrio have entered into a non-binding memorandum
of understanding to establish the preliminary terms and conditions for a
potential merger.
Smithfield Foods, based in Smithfield, Va., is a pork and meat processor.
The company's shares rose 9.5% to $25.55.
Gabriel Madway
gm
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