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New Packing Plant!

Mike

Well-known member
Smithfield and ContiGroup to Build New Beef Processing Plant
Oct. 18, 2006

Smithfield Beef Group, Inc. and ContiGroup Companies, Inc. today announced an agreement in principle to form a 50/50 joint venture to build a new, state-of-the-art beef processing plant in Texas County, Oklahoma, that will create 2,500 to 3,000 jobs.

Construction of the plant, which will be the first of its size in more than 20 years in the United States, is expected to begin in January 2007, with completion scheduled for mid-2008. The parties plan to equip the new 650,000- square-foot facility with the most efficient and state-of-the-art operational and food-safety processes in the industry. Cost of the project is estimated to be approximately $200 million.

The Texas County plant is expected to process 5,000 head per day at full capacity. The new facility will likely draw employees from nearby communities.

"We reviewed more than 30 potential locations in five states, met with local economic development and agricultural leaders, and visited a short list of ten potential sites before deciding that Texas County is ideally suited for our new facility," said Richard V. Vesta, president and chief executive officer of Smithfield Beef Group.

"We selected Texas County because of its proximity to nearby feedyards, the availability of water supply, the area's outstanding labor pool and well- developed utility and transportation infrastructures," Vesta said. "We also received tremendous cooperation from the state's elected and appointed officials."

"We expect to source cattle for the plant from the plentiful nearby supply of livestock including the surrounding Five Rivers feedyards, which we believe will save considerable transportation expense," said Vesta. "Access to these cattle also will be valuable in terms of traceability, an increasingly important issue in the United States and in export markets. There have been many accomplishments and improvements in food safety and processing technology since the last large-scale beef processing plant was built more than 20 years ago. With this new, modern facility, we will be the technological leader in the industry," he said.

"We have the utmost respect for the management of ContiGroup and we are delighted to have them as a partner in this venture," Vesta said. "The decision to build the new plant demonstrates Smithfield Beef Group's commitment to providing our customers with the high-quality products they expect and deserve." Vesta and a core team from Smithfield Beef Group will oversee Smithfield's investment in the joint venture.

"We are pleased to participate in this venture with Smithfield Beef Group, building on our relationship that started with the formation of Five Rivers," said Paul J. Fribourg, chairman and chief executive officer of ContiGroup Companies, Inc. "Smithfield is committed to be an 'agent of change' in the beef industry. Joining with them in this new venture will permit us both to move farther up the value-added chain," he said.

In May of 2005, Smithfield Foods, Inc. and ContiGroup Companies, Inc. formed Five Rivers Ranch Cattle Feeding LLC, a joint venture between their respective cattle feeding businesses, MF Cattle Feeding, Inc., formerly a subsidiary of Smithfield Beef Group, and ContiBeef LLC, formerly a subsidiary of ContiGroup Companies. Five Rivers is a stand-alone operating company, independent from both ContiGroup Companies and Smithfield Foods.

SOURCE: Smithfield Beef Group, Inc.

Wonder what the "Incentive" package was worth to them? I guess if they are doing it for the foreign automakers they should do it for packers.

Could a small packer get free money from the guvment to build a small plant?
 

Econ101

Well-known member
Every guvment subsidy takes us away from a more efficient market driven economy. Industry has found out how to make state/local governments compete for them at the expense of those paying taxes. It is just corporate welfare. The politicians can't help but spend other people's money and the courts are not stopping them.

I don't know if they have an incentive package here, but if they do, it is wrong.

Corporatism pure and simple.


"Corporatism should be more accurately defined as fascism, as it is the merging of corporate and state power" ---Benito Mussolini
 

Mike

Well-known member
Smithfield will buy Premium Standard in $810M deal
Triangle Business Journal - September 18, 2006
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Smithfield Foods Inc. will buy Premium Standard Farms Inc. in a stock-and-cash transaction valued at $810 million.

In a release early Monday, Smithfield Foods (NYSE: SFD), based in Smithfield, Va., said both companies' boards had unanimously approved the deal, which the companies expect to close in the first quarter.


Smithfield is one of the largest hog and pork producers in the world. The company employs roughly 5,000 workers at its Tar Heel slaughterhouse in southeastern North Carolina.

Smithfield Foods will buy all the roughly 32 million outstanding shares of Kansas City, Mo.-based Premium Standard Farms (Nasdaq: PORK). Each Premium Standard share will be converted into the right to receive 0.678 Smithfield shares plus $1.25 in cash, for a combined stock-and-cash value of $21.35 a share, based on Smithfield's average closing price in the past 10 trading days. Smithfield's stock closed on Friday at $29.24 a share.

The $810 million transaction includes Smithfield's assumption of about $117 million in Premium Standard's debt.

Smithfield said in the release that ContiGroup Cos. Inc., which owns 38.8 percent of Premium Standard's stock, has signed a shareholder support agreement committing it to vote its shares in favor of the transaction.

Smithfield said it will honor all current Premium Standard hog production contracts and remain committed to making open-market purchases of "significant" numbers of hogs. Smithfield also said Premium Standard's facilities will remain open and in operation at least at current production levels.

Premium Standard Farms produces pork products for retail, wholesale, food service, export and other processor markets. The company bills itself as the nation's second-largest pork producer and sixth-largest pork processor. It has about 4,300 employees at farms and processing facilities in Missouri, North Carolina and Texas, including a production and processing facility in Clinton.

For the year that ended June 24, the company reported earnings of $45.3 million on sales of $880 million.

With annual sales of $11 billion, Smithfield is the leading processor and marketer of fresh pork and processed meats, and the largest producer of hogs, in the United States.


Smithfield keeps stretching it out!
 

Econ101

Well-known member
Mike said:
Smithfield will buy Premium Standard in $810M deal
Triangle Business Journal - September 18, 2006
Print this Article Email this Article Reprints RSS Feeds Most Viewed Most Emailed
Smithfield Foods Inc. will buy Premium Standard Farms Inc. in a stock-and-cash transaction valued at $810 million.

In a release early Monday, Smithfield Foods (NYSE: SFD), based in Smithfield, Va., said both companies' boards had unanimously approved the deal, which the companies expect to close in the first quarter.


Smithfield is one of the largest hog and pork producers in the world. The company employs roughly 5,000 workers at its Tar Heel slaughterhouse in southeastern North Carolina.

Smithfield Foods will buy all the roughly 32 million outstanding shares of Kansas City, Mo.-based Premium Standard Farms (Nasdaq: PORK). Each Premium Standard share will be converted into the right to receive 0.678 Smithfield shares plus $1.25 in cash, for a combined stock-and-cash value of $21.35 a share, based on Smithfield's average closing price in the past 10 trading days. Smithfield's stock closed on Friday at $29.24 a share.

The $810 million transaction includes Smithfield's assumption of about $117 million in Premium Standard's debt.

Smithfield said in the release that ContiGroup Cos. Inc., which owns 38.8 percent of Premium Standard's stock, has signed a shareholder support agreement committing it to vote its shares in favor of the transaction.

Smithfield said it will honor all current Premium Standard hog production contracts and remain committed to making open-market purchases of "significant" numbers of hogs. Smithfield also said Premium Standard's facilities will remain open and in operation at least at current production levels.

Premium Standard Farms produces pork products for retail, wholesale, food service, export and other processor markets. The company bills itself as the nation's second-largest pork producer and sixth-largest pork processor. It has about 4,300 employees at farms and processing facilities in Missouri, North Carolina and Texas, including a production and processing facility in Clinton.

For the year that ended June 24, the company reported earnings of $45.3 million on sales of $880 million.

With annual sales of $11 billion, Smithfield is the leading processor and marketer of fresh pork and processed meats, and the largest producer of hogs, in the United States.


Smithfield keeps stretching it out!

With the lack of enforcement of our laws regulating monopolies, this has become a free for all race in the concentration game. Bill Moyers interviewed a guest who said the same thing about the media when the number of radio stations went from a regulated number of 40 to whatever they could buy. The number of radio stations giving local support went down --something like 4000 to less than 1200 (these figures may be off as I barely caught it). Local stations were bought up, the staff fired, and syndicated shows went up. Local news and democracy took the hit. Diversity too.
 
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