Ham sandwich, you eat lunch U.S. investment in China's growing appetite for the latest example.
Smithfield Foods, the largest U.S. pork producers, on Wednesday agreed Shuanghui International Holdings Limited, China's largest meat processor, major shareholders, approximately 4.72 one billion U.S. dollars to be bought.
The deal, which still faces federal regulatory review and approval of the shareholders Smithfield is the world's largest Chinese company acquired a U.S. company. This is the latest recently by the Chinese company to make such a deal in a string.
But the acquisition is likely to face huge U.S. scrutiny. It is in China, there is a serious food safety issues, some of which include Smithfield suitor, based in Hong Kong Shuanghui.
The risk of the U.S. food supply "into the hearts of everyone, saying:" In the variant Capital Advisors director Paul Mariani, in Chicago, he worked in the food and agriculture boutique investment bank. But he said he believed Smithfield will continue normal operation.
Smithfield said the deal is not imported from China into the United States rather than pork, the company said, this is an opportunity to enter new export markets, its brands, such as Smithfield, armor and farmland.
, Smithfield CEO Larry Pope said on a conference call on Wednesday that the deal "to keep the same old Smithfield, only more opportunities and new markets and new areas."
"People have a belief that ...... everything in America is made in China," he said. "Open your refrigerator door and see if there is any manufacture in China, because the U.S. Department of Agriculture is the most competitive in the world, and efficiency."
Indeed, what could be the highlight of the acquisition in the United States by Chinese consumers growing interest in food. Foreign foods, such as milk powder from New Zealand and its Asian neighbors vegetables, is a precious Chinese consumers, because in their country's domestic frequent food safety scandal.
One of the most notorious, six infant deaths and 30 people sick in 2008 drank industrial chemical melamine-contaminated infant formula milk powder and other dairy products. Shuanghui battered reputation in 2011, when state television CCTV said its pork containing clenbuterol - a banned chemical that makes pork leaner but can be harmful.
Derek Scissors, an expert on the Chinese economy, with headquarters in Washington, conservative think tank Heritage Foundation (Heritage Foundation), said companies such as Shuanghui "does not intend to cause any trouble in the U.S. market at all" or "cut corners" .
"On the contrary ...... they want to get the United States is able to do," he said. "But whether they can run an American company in the U.S. market remains to be determined."
Smithfield has been under pressure to improve its business transactions.
Favorite pork producers, Wong has been caught in a tug of war with consumers. The company needed to raise prices to offset rising commodity costs, namely corn for feed. But consumers are still extremely sensitive to price changes in the current economy. By raising prices, Smithfield risks cutting into their sales, the consumer should be cut or buy cheap meat, such as chicken.
In recent months, Continental Grain Company, one of the largest shareholder in Smithfield, Smithfield has been pushed considering splitting itself, saying that this is a company to "create value for shareholders seriously."
Following the March letter from Continental Grain, Smithfield said it would review the proposal "at the appropriate time." Continental Grain representatives did not immediately comment on the deal announced last Wednesday.
In the most recent quarter, the company reported net income rose more than 3 percent, mainly due to pig production, and its international business, its packaged meats cooked meat, bacon, sausage and hot dogs and other revenue - a big growth areas of the company .
Let Smithfield Shuanghui new opportunities. The company has a variety of global enterprises, including food, logistics and seasoning products.
Shuanghui - Smithfield transaction, which is unanimously approved by the boards of both companies under the terms of Smithfield shareholders will receive $ 34 per share - a 31% premium, Virginia Smithfield's closing stock price of $ 25.97 Day ( Tuesday).
The company put the total value of the deal is approximately $ 71 billion, including debt. Smithfield's stock will no longer be publicly traded, once the transaction closes.
Smithfield processing, including the assumption of debt will be eclipsed Chinese purchases of U.S. companies as well as large investment stake. In December 2007, Morgan Stanley China Investment Corporation bought a 9.9% stake valued at $ 56 billion, according to research firm Dealogic data.
Smithfield shares surged $ 7.38, or 29 percent, to close at $ 33.35 last Wednesday.
Smithfield's existing management team will remain in place, it will honor Shuanghui Smithfield workers with collective bargaining agreements. The company has approximately 46,000 employees.
The transaction is subject to review by the U.S. Committee on Foreign Investment, to assess the potential impact on national security transactions. This process usually includes a 30-day preliminary examination, followed by recommendations, the president has 45 days to investigate.
China accused the U.S. company of discrimination, but analysts said U.S. companies to invest in China face greater obstacles.
The deal from U.S. companies to invest in China, is still relatively low, but has risen sharply in recent years, leading $ 6.5 billion in 2012 and so far this year total more than $ 10 billion in transactions in the pipeline, according to the New York study Thilo Hanemann firm Rhodium Group. Data reflects the threshold of foreign direct investment, which is a final 10% of the voting rights or more of the equity investment firm, such as government bonds excluding portfolio investments to meet.
Many investments in the energy, advanced manufacturing technology, as well as entertainment, hospitality and safe-haven assets such as real estate.
Hanemann said: "This is the U.S. economy and U.S. manufacturing good news, because Chinese companies keen to capitalize on the U.S. brand,." "China's investment level is still too low Savior ... (but) the future growth potential is enormous."
 
 



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