by Christopher Freeburn | September 3, 2013 10:24 am
A Chinese company’s plans to purchase the largest U.S. pork producer has hit a roadblock.
On Tuesday, one of Smithfield Foods‘ (SFD) largest shareholders warned its board of directors that it planned to vote against its proposed merger with Shuanghui International Holdings Ltd. Starboard Value LP sent a letter to the company’s board indicating that it wanted additional time to seek higher offers for the company, the Associated Press notes.
In May, Shuanghui International Holdings agreed to purchase Smithfield for $4.7 billion. Including debt, the transaction is valued at about $7.1 billion.
Starboard Value holds a 5.7% stake in Smithfield’s common shares. In June, the firm urged the Smithfield’s board to break up the company and sell its assets, arguing that the deal with Shuanghui undervalued the pork producer.
Shares of Smithfield rose almost 1% in Tuesday morning trading.
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