Rigrodsky & Long, P.A. and some other law firms are
investigating probable breaches of fiduciary duties and any
possible violations of law against the board of directors of
The Hillshire Brands Company
). The investigation is in regard to its definitive acquisition
Tyson Foods, Inc.
) that was clinched on Jul 02. Since, then, The Hillshire Brands
Company has been facing several legal issues.
According to the agreement, Tyson Foods will pay $63 per share in
cash for all the outstanding shares of Hillshire, valuing the
company at approximately $8.55 billion, including debt. On
the same day, Hillshire's board accepted the notice of termination
of the deal from frozen foods maker
Pinnacle Foods, Inc.
), which was the prime condition for Tyson's deal to materialize.
Tyson stated that it will pay a termination fee of $163 million to
Pinnacle Foods on behalf of Hillshire related to the cancellation
of the Hillshire-Pinnacle deal.
Chicago-based Hillshire Brands had proposed to buy Pinnacle Foods
for about $6.6 billion on May 12, including debt, in order to
diversify its portfolio. However, two weeks later Tyson and poultry
Pilgrim's Pride Corp.
) engaged in a bidding war to acquire Hillshire. It came to an end
when Tyson finally clinched the deal with its offer of $63 per
share made on Jun 9. However, the deal with Tyson was contingent on
the termination of the pending Pinnacle-Hillshire deal.
Meanwhile, besides Rigrodsky & Long, P.A, the law firms
investigating the probable breach of fiduciary duty and other
violations include Andrews & Springer LLC, Levi & Korsinsky
and Brower Piven, A Professional Corporation. These firms are
mostly concerned about whether the Hillshire-Tyson deal is
Tyson is the largest U.S. meat producer and is a leading retailer
of prepared foods. The acquisition of Hillshire's top meat brands
like Jimmy Dean sausages and Ball Park hot dogs will complement
Tyson's portfolio and would make Tyson the industry leader in
chicken production. Hillshire, on the other hand, will receive a
substantial premium and immediate cash benefit for its
shareholders. Tyson's acquisition of Hillshire is expected to close
by Sep 27 this year.
Hillshire Brands carries a Zacks Rank #2 (Buy) while Tyson carries
a Zacks Rank #3 (Hold).
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TYSON FOODS A (TSN): Free Stock Analysis Report
HILLSHIRE BRAND (HSH): Free Stock Analysis
PINNACLE FOODS (PF): Free Stock Analysis Report
PILGRIMS PRIDE (PPC): Free Stock Analysis
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