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Pilgrim's Pride will buy Gold Kist in $1.1 billion cash deal

by 5m Editor
5 December 2006, at 1:24pm

US - Poultry producer Pilgrim's Pride (PPC) won its formerly hostile bid to buy rival Gild Kist (GKIS), saying Monday it will pay $21 a share in a cash deal worth $1.1 billion.

Gold Kist, based in Atlanta, initially fought overtures by Pilgrim's Pride, which is based in Pittsburg, Texas. But the two companies now say they have reached an agreement.

The offer is $1 per share higher than Pilgrim's Pride's initial offer, announced in August. Pilgrim's Pride will also assume about $144 million in Gold Kist's debt.

Gold Kist had said it wanted to remain on its own, but by last Wednesday, Gold Kist shareholders had tendered 34.1 million shares, or 67% of the company's stock to Pilgrim's Pride.

The combined company will be the world's leading chicken company in terms of production and the third-largest U.S. meat company by revenue, according to the companies, which say the combination will help Pilgrim's Pride compete in the U.S. and abroad. It will employ 56,000 people — 40,000 at Pilgrim's Pride and 16,000 at Gold Kist.

O.B. Goolsby, Pilgrim's Pride's president and chief executive officer, said in a telephone interview that there could be job cuts in corporate positions in functions such as human resources, information technology and accounting because of duplication from the two companies. He did not specify a number.

Source: USA Today

5m Editor