Tyson Foods, Inc., Springdale, Ark., announced plans to acquire AdvancePierre Foods Holdings, Inc., Cincinnati, for $40.25 per share.
“We are very pleased to announce this combination with AdvancePierre,” says Tom Hayes, Tyson president and CEO. “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. This transaction will provide an attractive current premium to AdvancePierre shareholders as well as significant ongoing benefits to Tyson shareholders and the customers and team members of both companies. We are always prudently evaluating opportunities to leverage our strengths to drive future growth, whether by divesting non-core, non-protein focused assets or by acquiring companies like AdvancePierre, that enhance our capabilities in growing categories. We believe that AdvancePierre and Tyson are a natural strategic fit, and together will accelerate growth for customers by delivering on-trend, high-quality products consumers love. We look forward to welcoming AdvancePierre’s dedicated team members to the Tyson family.”
“We couldn’t be more delighted to join Tyson,” adds Christopher Sliva, AdvancePierre president and CEO. “By combining our complementary, market-leading portfolios, both companies will realize greater opportunities. 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.”
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. This acquisition will further Tyson’s strategic intent to sustainably feed the world with its fast-growing portfolio of protein-packed brands.
AdvancePierre’s product portfolio also 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, entrées and snacks will extend Tyson’s core strength into the convenience and retail perimeter with solutions that span all-day parts. The Barber Foods brand of value-added chicken products for instance maintains a strong heritage in both retail and foodservice channels.
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.
Tyson expects the transaction will result in cost synergies of approximately $200 million, to be fully realized within three years. Tyson also sees the opportunity to utilize high-quality raw materials from the fresh meats division to drive growth and efficiency.