Food & Beverage

Cargill, Continental Grain to acquire Sanderson Farms, create poultry powerhouse

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August 9, 2021

Cargill and Continental Grain Co. are forming a joint venture to acquire Sanderson Farms Inc. for $203 per share in cash, representing a total equity value for Sanderson Farms of $4.53 billion, according to a press release.

The purchase price represents a 30.3% premium to Sanderson Farms' unaffected share price of $155.74 on June 18, 2021, the last full trading day prior to media speculation about the potential sale of Sanderson Farms; a 22.8% premium to the Sanderson Farms 30-day volume weighted average price as of June 18, 2021, and a 15.2% premium to the all-time high share price as of June 18, 2021.

Upon completion of the transaction, Cargill and Continental Grain will combine Sanderson Farms with Wayne Farms, a subsidiary of Continental Grain, to form a new, privately-held poultry business.

The new company will service customers across retail and foodservice.

Wayne Farms CEO Clint Rivers will lead the combined company.

Operations for the new company will include poultry processing plants and prepared foods plants across Alabama, Arkansas, Georgia, Louisiana, Mississippi, North Carolina and Texas.

The transaction is expected to close by the end of 2021 or early 2022, and will be subject to regulatory and Sanderson Farms stockholder approval, and other customary closing conditions.