Shuanghui Weighs Options on Campofrio Stake

Smithfield Foods Inc., the world’s biggest hog and pork producer, and its owner China’s Shuanghui International Holdings Ltd. are weighing options for Smithfield’s 37 percent stake in a Spanish sausage maker.

Smithfield said in a Dec. 6 filing it has reviewed its shareholding in Campofrio Food Group SA and a takeover bid made for the Spanish company.

Sigma Alimentos, a unit of Mexico’s Alfa SAB, last month offered 675 million euros ($926 million) for Madrid-based Campofrio, its first foray into Europe.

Shuanghui, which bought Smithfield in September for $4.7 billion, is considering a rival bid for Campofrio, El Mundo reported Nov. 27. Hong Kong-based Shuanghui said Nov. 27 it signed an $8 billion non-binding funding agreement with Bank of China Ltd. as it seeks to expand, possibly through acquisitions.

Keira Lombardo, a spokeswoman for Smithfield, and Chuck Dohrenwend, a Shuanghui spokesman, declined to comment yesterday on the companies’ options for the Campofrio stake.

In September, Shuanghui said it will reduce its indirect stake in Campofrio to below 30 percent of voting rights within three months.

When a bid is approved by regulators in Spain, an acceptance period set by the bidder begins and counterbids can be launched until five days before the end of that period. Spain’s regulators haven’t approved Sigma’s offer yet.

(Corrects spelling of Shuanghui in fourth paragraph.)
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