Tyson Foods has agreed a deal to acquire meat product manufacturer Keystone Foods from Marfrig for $2.16 billion.
Keystone produces a range of meat products including chicken nuggets, chicken fillets, beef patties and more for foodservice clients such as McDonald’s, as well as for retail channels in the US.
Tyson entered negotiations to acquire the business in July, and reports circulated on Friday 17 August claimed that Marfrig had agreed to sell its Keystone Foods subsidiary to Tyson, though both companies did not confirm that a deal had been agreed at the time.
However, Marfrig has today confirmed the sale, stating that the deal would include all Keystone assets except for a beef patty processing site in Baltimore, Ohio.
According to Marfrig, the retention of the Baltimore beef plant is “aligned with the company’s strategy to focus on the beef business”, following the company’s recent purchase of a majority stake in Missouri-based National Beef Packing Company for $969 million, which made Marfrig the world’s second-largest beef processing company.
Tyson will acquire six processing plants and an innovation centre in the US as part of the acquisition, as well as eight production facilities and three innovation centres in China, South Korea, Malaysia, Thailand and Australia.
The acquisition will strengthen Tyson’s presence in the protein product segment, as the company seeks to focus on its core protein operations as part of its revised business strategy.
Tom Hayes, president and CEO of Tyson Foods said: “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.
“We look forward to serving customers with these additional capabilities and to welcoming Keystone’s dedicated team members to the Tyson Foods family.”
Tyson has made a number of investments to strengthen its presence in the meat segment over the course of the year, such as the acquisition of organic chicken producer Tecumseh Poultry in June, and the company also invested $300 million to build a new poultry processing plant in Humboldt, Tennesee.
The company has also invested in a number of innovative meat start-ups, leading a $2.2 million funding round in Israel-based biotechnology company Future Meat Technologies, and investing in US-based lab-grown meat start-up Memphis Meats in January.
Earlier this month, Tyson agreed to sell its TNT Crust pizza crust manufacturing business, and the company’s adapting business strategy also led to the sale of its Sara Lee Frozen Bakery and Van’s businesses to private equity firm Kohlberg & Company earlier this year.
© FoodBev Media Ltd 2020