Jimmy Dean parent Tyson Foods has held talks to buy Foster Farms for $2 billion
Meat processor Tyson Foods has held talks to buy privately-owned California-based Foster Farms for roughly $2 billion, people familiar with the situation tell CNBC.
The two have had disagreements over price, and it is possible the talks could fall apart.
If a deal is consummated, it is still at least several weeks away.
Lauren Hirsch, CNBC
Feb 5, 2019
Meat processor Tyson Foods has held talks about buying privately owned California-based Foster Farms for roughly $2 billion, people familiar with the situation tell CNBC.
The two sides are disagreeing over price, said these people, and it is possible the talks fall apart. If a deal is consummated, it is still at least several weeks away.
Shares of Tyson briefly dropped nearly 2 percent on news of the talks, but quickly rebounded to $61.64 a share, off less than 1 percent.
Tyson, one of the biggest food companies in the U.S. by sales, supplies meat to restaurants and other food-service customers. It also sells branded chicken, beef, and pork under labels like Jimmy Dean, Hillshire Farm and Golden Island Jerky.
The deal talks come just months after Tyson closed its $2.16 billion acquisition of McDonald's meat supplier Keystone Foods, which further expanded its capabilities in Asia.
An acquisition of a U.S. brand like Foster Farms, which makes products like branded chicken, turkey and frozen foods, would therefore mark a mild change in course for Tyson. It would instead echo a strategy it pursued in 2014, with its $7.7 billion acquisition of Hillshire Brands, which brought with it Jimmy Dean sausages and Ball Park hot dogs.
Tyson executives were asked about their global M&A strategy during the company's November earnings call. Of particular concern to one analyst was international expansion in the context of geopolitical uncertainty and currency fluctuations.
In response, CEO Noel White said...