Pilgrim's Pride GNP to be acquired from The Maschhoffs
The all-cash, $350 mill. transaction is expected to close in the first quarter of 2017 pending regulatory approval and review. The addition of GNP’s Just Bare line of natural and organic poultry products to Pilgrim’s portfolio is complementary to its strategy to grow its operations in new markets.
According to a statement, Pilgrim’s expects to realize $20 mill. in annual operating synergies in production and distribution and it plans on capturing an estimated present value of approximately $28 mill. in tax savings and a post synergies EBITDA multiple of 3.9.
GNP was acquired by The Maschhoffs, a family owned, pork production company based in Carlyle, Illinois, USA, in 2013. Josh Flint, PR and communications manager with The Maschhoffs said, the acquisition demonstrates his company’s continued focus on the hog production industry. He added that the sale of GNP was not result of it being an underperforming business unit and is merely part of The Maschhoffs’ long-term strategy to solidify its role serving pork-processing customers.
Pilgrim’s expects the acquisition will be accretive to the company’s diluted earnings per share in 2017 and said the combined company will deliver strong financial results, including a stronger capital structure and improved cash flow.