Smithfield Foods' shareholders on Tuesday approved the pork giant's US$4.7 billion sale to Shuanghui International Holdings in what's shaping up as the biggest acquisition of a U.S. company by a Chinese firm.
The closely watched transaction, valued at $7.1 billion including debt, is expected to close by Thursday (all figures US$).
The deal, which aims to satisfy China's increasing appetite for pork, marries two of the world's largest pork producers and had faced scrutiny over China's high-profile food safety failures, concerns over U.S. pork supplies and U.S. national security.
But earlier this month, the U.S. Committee on Foreign Investment cleared the way for the deal, removing an important hurdle.
More than 96 per cent of the votes cast at a special Smithfield shareholder meeting on Tuesday were in favour of the acquisition. The votes cast represented 76 per cent of Smithfield's outstanding common shares, the company said in a statement.
Under the terms of the deal, Smithfield shareholders will receive $34 cash for each share of Smithfield common stock they own.
After the acquisition closes, Shuanghui must then decide the fate of Spanish packaged meats company Campofrio, of which Smithfield holds a 37 per cent stake.
Shuanghui can decide to buy the remaining stake in Campofrio which it does not own, or will have to reduce its position to less than 30 per cent.
Smithfield had previously held talks to acquire a controlling interest in Campofrio in 2011 but scrapped plans, citing a weak European economy.
"We will comply with the applicable Spanish decrees on this matter," said a spokesperson for Shuanghui International. "After closing our merger, we will notify the Spanish stock exchange commission of our intended actions in this regard." -- Reuters
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