Hillshire moves to get out of Pinnacle offer
The board of directors of Hillshire Brands has unanimously determined to withdraw their support of the offer to buy Pinnacle Foods. Last month the board recommended the acquisition of Pinnacle and its Birdseye, Duncan Hines and other brand names. That triggered an offer from Pilgrim’s Pride and then Tyson Foods to acquire Hillshire Brands. A bidding war evolved with Tyson winning-out in the end at $63 per share all cash.
The Tyson offer is contingent on Hillshire getting out of the Pinnacle offer and that is what the board is now recommending after determining that the Tyson offer “constitutes a superior proposal” for the shareholders.
Written notice of the decision was sent to Pinnacle with the option that Pinnacle could propose changes to the merger agreement that would make them more attractive than the Tyson proposal but Pinnacle “made no such proposal.” Depending upon how Pinnacle proceeds with the termination process, it could cost Hillshire $163 million. The Tyson deal cannot be completed until the Pinnacle deal is terminated. Tyson says their offer stands until December 12, 2014.
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