On May 29, China’s largest meat processor Shuanghui International Holdings announced it was buying Virginia-based Smithfield Foods Inc., the world’s largest pork producer, for $4.7 billion in a takeover that would be China’s biggest acquisition of a US company. Before the deal goes through, it will be reviewed by the Treasury Department’s Committee on Foreign Investment in the United States (CFIUS), a government panel that assesses national security risks. In addition, Smithfield was given 30 days to continue talks with other buyers, and Shuanghui’s chair Wan Long has said he may raise the offer, according to Bloomberg News.
Several members of Congress have already voiced opposition to the deal because of food safety concerns, but Reuters is reporting that many executives expect the deal to pass. In 2011, Shuanghui apologized over illegal additives found in its meat and pledged to strengthen its quality control.
Wan said the deal will help Smithfield sell its products in China through Shuanghui’s distributors and give Shuanghui access to high-quality US products. “China’s demand for meat products is getting bigger and bigger,” Wan told Bloomberg News. “We very much need to bring in advanced production and technologies from overseas.” Shuanghui has also said it will not close or move any of Smithfield’s operations and it will keep current management, including CEO Larry Pope, in place.