Source: Tom Johnston, MEATINGPLACE, 9/4/13


An activist hedge fund has told Smithfield Foods investors it is working with other potential buyers that would pay “substantially” more to acquire the nation’s largest pork producer than China’s Shaunghui International Holdings has offered, according to various media reports.

Starboard Value LP, a hedge fund that wants to break up Smithfield, said interested buyers would pay well more than the $4.7 billion, or $34 per share, that Shuanghui offered in May.

"It is our belief that the proposed merger undervalues Smithfield and that with more time an alternative proposal to the board at a superior price for shareholders could be available," Starboard said in its letter, according to the Wall Street Journal.

Starboard told Smithfield investors it would vote against Shuanghui proposal in an effort to prompt Smithfield to delay the Sept. 24 vote. Smithfield’s board reportedly can entertain other bids that are received before shareholder approval of the proposed merger.

The Shuanghui deal allows Smithfield to delay the meeting if it’s short on votes to approve it and includes a Nov. 29 deadline to do so, the Wall Street Journal reported.

Starboard said it would ultimately vote in favor of the Shuanghui deal if an alternative offer fails to materialize.

A Smithfield spokeswoman declined to comment when reached by Meatingplace.

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