SMITHFIELD, VA. — Smithfield Foods, Inc. has entered into an agreement to acquire Clougherty Packing L.L.C. from Hormel Foods Corp., Austin, Minn., for approximately $145 million. Clougherty is the manufacturer of such brands as Farmer John and Saag’s Specialty Meats.
Clougherty slaughters approximately 7,400 hogs per day and, in fiscal 2016, the businesses accounted for approximately $500 million in sales, according to Hormel Foods.
|Kenneth M. Sullivan, president and c.e.o. of Smithfield Foods|
“By folding Farmer John into our operations, we are better positioned to take advantage of our long-term strategic growth goals, which includes an increasingly diversified customer and consumer base and greater supply chain efficiency,” said Kenneth M. Sullivan, president and chief executive officer of Smithfield Foods. “As we continue this transition and expand our operations, we are proud to welcome these new West coast employees into our growing Smithfield family.”
Along with two California-based processing facilities, Smithfield will acquire three hog farms located in Arizona, California and Wyoming that are managed under the business name PFFJ L.L.C.
|Jim Snee, president and c.e.o. of Hormel Foods|
“While the businesses have performed well, they no longer align with our company’s growth strategies,” said Jim Snee, president and c.e.o. of Hormel Foods. “This divestiture also allows for the integration of the pork processing facility at Farmer John with the majority of the live production operations that supply the facility, and are currently owned by Smithfield. We will work together to ensure a smooth transition for our employees and customers.”
The transaction is expected to close within the next 30 days pending customary closing conditions and regulatory approvals.