Turns out all those people who put money into pork futures were right, after all. Today it was announced that Chinese company Shuanghui will buy Smithfield, one of America's largest pork producers, for $34 per share, about 30 percent above its closing share price yesterday. Reports on the value of the deal vary; some report it as $4.7 billion, some say it's $7.1 billion. Either way, this is the largest takeover of an American company by a Chinese company.
There are concerns on this deal, naturally. Shuanghui was embroiled in a tainted meat scandal two years ago in China, but the companies say this deal will primarily focus on exporting American pork to China. Shuangui says it also hopes to learn more about the United States food safety processes. China is the world's biggest pork market.
So, it seems the only thing we don't get from China these days is pork, retaining it as a part of our American heritage. And now they're taking our pork. It's easy to say this is a win for the overall health of Americans, a blow to the "obesity epidemic," as it were. But bacon isn't to blame, it's the maple coating on the bacon, the chocolate bar in which the bacon is mixed, the 1,400-calorie burger on which it sits that is the real culprit. Only time will tell how this deal plays out.
Smithfield says it's keeping its operations in the U.S., which is good for its 46,000 employees. The headquarters will remain in Virginia and no facilities will close, says Smithfield. For now, at least, it's only the profits that will be leaving.