Smithfield Foods’ history goes all the way back to 1936. Originally known as the Smithfield Packing Company, Joseph W. Luter, along with his son, would establish a pork producing and food processing company that today, has become the biggest pig and pork producer in the world.
A deal would go down in 2013 that was four years in the making and would see China’s largest meat producer, WH Group (previously known as Shuanghui Group), buy Smithfield for $34 per share, which equates to about $4.72 billion. They would also take any existing debt they had on their books, making the total deal worth around $7.1 billion.
Before the deal could be finalized, approval would not only be needed from the Smithfield shareholders but the Committee on Foreign Investment in the United States had to give it their OK, which inevitably they did. Once it was finalized it would be the biggest acquisition of an American firm by a Chinese company.
Many were worried about jobs and the future of the company but in just 3 short years, the WH Group managed to increase profits by an impressive 17%. This was done in no small part to the increased expansion of Smithfield Foods, as they would spend an additional $145 million to buy California-based Clougherty Packing from its parent company Hormel Foods.