USA, Springdale, Ark. Tyson Foods, Inc. announced it has reached a definitive agreement to buy the Keystone Foods business from Marfrig Global Foods for $2.16 billion in cash.
The acquisition of Keystone, a major supplier to the growing global foodservice industry, is Tyson Foods’ latest investment in furtherance of its growth strategy and expansion of its value-added protein capabilities.
Headquartered in West Chester, Pennsylvania, Keystone supplies chicken, beef, fish and pork to some of the world’s leading quick-service restaurant chains, as well as retail and convenience store channels. Its value-added product portfolio includes chicken nuggets, wings and tenders; beef patties; and breaded fish fillets.
The acquisition includes six processing plants and an innovation center in the US with locations in Alabama, Georgia, Kentucky, North Carolina, Pennsylvania and Wisconsin. It also includes eight plants and three innovation centers in China, South Korea, Malaysia, Thailand and Australia.
“Keystone is a leading global protein company and will be a great addition,” commented Tom Hayes, president and CEO of Tyson Foods. “This acquisition will expand our international presence and value-added production capabilities and help us deliver more value to our foodservice customers. Keystone provides a significant foundation for international growth with its in-country operations, sales and distribution network in high growth markets in the Asia Pacific region as well as exports to key markets in Europe, the Middle East and Africa.”
Keystone, which employs approximately 11,000 people, generated annual revenue of $2.5 bn. and adjusted EBITDA of $211 mill. in the last 12 months ending 30th June, 2018, excluding non-controlling interest and other adjustments. During the same period, the company generated approximately 65% of its revenue from U.S.-based production and the remaining 35% from its Asia Pacific plants.
The transaction, which has been approved by Tyson Foods’ board of directors, is expected to close in mid-fiscal 2019. It is subject to customary closing conditions, including regulatory approvals.
Morgan Stanley & Co. LLC is acting as exclusive financial adviser to Tyson Foods on the acquisition, and Davis Polk & Wardwell LLP is acting as its legal counsel.