Tyson Foods focusing on protein after $4.2bn AdvancePierre deal

Tyson Foods has agreed to acquire AdvancePierre Foods for $4.2 billion, in a deal that it said would ‘expand its portfolio of prepared foods’ and ‘contribute to sustainable, long-term growth’.

The sale price represents $40.25 per share – a premium of nearly 32% on AdvancePierre’s closing price at the start of the month. Oaktree Capital Management, which held approximately 42% of the shares in AdvancePierre Foods, has also agreed to sell up as part of the transaction.

Tyson Foods president and CEO Tom Hayes said: “We are very pleased to announce this combination with AdvancePierre. The AdvancePierre leadership team has created significant value through the implementation of a new business management model, focus on quality and service and attention to the growth opportunities in convenience foods. The addition of AdvancePierre aligns with our strategic intent to sustainably feed the world with the fastest growing portfolio of protein packed brands. This transaction will provide an attractive current premium to AdvancePierre shareholders as well as significant ongoing benefits to Tyson shareholders and the customers and team members of both companies.”

It comes a day after Tyson Foods announced that it was exploring the sale of three non-protein businesses, with protein-packed brands continuing to be a major part of its corporate strategy. The company said that it would offload the Sara Lee frozen bakery business, the Kettle business, and Van’s.

“We are always prudently evaluating opportunities to leverage our strengths to drive future growth, whether by divesting non-core, non-protein focused assets – as announced yesterday – or by acquiring companies like AdvancePierre that enhance our capabilities in growing categories,” Hayes said. “We believe that AdvancePierre and Tyson are a natural strategic fit and together will accelerate growth for customers by delivering on-trend, high quality products consumers love. We look forward to welcoming AdvancePierre’s dedicated team members to the Tyson family.”

AdvancePierre president and CEO Christopher D Sliva added: “We couldn’t be more delighted to join Tyson. By combining our complementary, market-leading portfolios, both companies will realise greater opportunities. This combination will allow AdvancePierre to accelerate its growth and broaden its distribution network by leveraging Tyson’s existing distribution infrastructure and go-to-market capabilities. Importantly, the transaction also offers compelling and certain value for our shareholders and will provide long-term benefits for our team members and customers.”