Wayne Farms parent company Continental Grain is part of a joint venture buying the larger Sanderson Farms, with plans to combine Sanderson with Wayne Farms. The new firm will be a privately held company with poultry processing plants and prepared foods plants in North Carolina, Alabama, Arkansas, Georgia, Louisiana, Mississippi, and Texas.
Wayne Farms spokesperson Frank Singleton said the new deal will have no effect on the firm’s Dobson operations. He said the company has about 1,000 employees there, along with 130 growers.
The deal is a joint venture of Continental Grain and Cargill, a private firm that is one of the world’s largest food companies, with more than 155,000 employees in 70 countries, according to Associated Press reports.
The deal, valued at more than $4.5 billion, will pay Sanderson Farms stockholders $203 per share, 30% higher than the stock was trading on June 14, when the world of the potential deal first became public.
Wayne Farms has more than 9,000 employees at present, while the Laurel, Mississippi-based Sanderson Farms has 17,000 employees and 12 plants. The new firm will be headed by Wayne Farms CEO Clint Rivers.
“Since my grandfather founded Sanderson Farms 75 years ago, our many significant achievements have been driven by our commitment to providing the very best chicken products in a profitable manner that benefits each of the constituents who contribute to our success,” said Joe Sanderson, chairman and CEO of Sanderson Farms. “This transaction is the culmination of that commitment, as it delivers a significant value to our stockholders, reflecting the dedication of our team, and our best-in-class assets, quality products, efficient and sustainable operations, and respected brand.
“We are very happy to partner with Cargill with whom we have had a decades-long relationship between two family-owned companies. Sanderson Farms’ operations, best-in-class assets, and valuable brand have underscored their success, and we have the highest respect for Joe Sanderson, and the business and team he has built as the third-generation CEO,” said Paul Fribourg, chairman, and CEO of Continental Grain. “Wayne Farms has been one of the most important and successful parts of Continental Grain for almost 60 years, so bringing together two great partners with two great poultry companies will ensure good things for our customers, our grower partners, and our employees.”
The transaction is expected to close by the end of 2021 or early 2022, and will be subject to regulatory and Sanderson Farms stockholder approval. Once the deal closes, the firm will be private, and Sanderson Farms will no longer appear on the NASDAQ.