Source:  RIta Jane Gabbett, MEATINGPLACE.COM, 9/8/10

It now appears more likely that Smithfield Foods will sell its 49 percent share in Butterball LLC, rather than buy out its joint venture partner, Maxwell Farms LLC, said CEO C. Larry Pope on a conference call with analysts.

“All indications are, we will be the seller,” said Pope, adding that Smithfield would have preferred to buy the operation. In June, the company offered its partner $200 million to buy its 51 percent of the turkey operation.

At the time, Pope said he wanted to put capital into Butterball and restructure its operations.

Pope also said in June, "On the other hand, if we are the seller, we will have exited the turkey business at a price that we believe fairly values the operations. Either way, we will be pleased with the outcome."

On today’s conference call, one analyst asked if Smithfield does sell Butterball, whether it might use the estimated $200 million it might receive to pay down debt.

“We are waiting to see what happens with Butterball,” CFO Robert W. "Bo" Manly said, but indicated that paying down debt might be considered.

The company expects to conclude the buy/sell decision this month and close before the end of the calendar year.

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