George’s, Inc., has completed the purchase of the Tyson Foods complex in Harrisonburg, Virginia, officials from both companies announced Monday. The transfer of ownership took effect May 7 and includes the processing plant in Harrisonburg and a hatchery, as well as a feed mill and truck shop. Financial details were not disclosed.

The Harrisonburg complex, which employs more than 500 people and has 121 contract poultry farms, produces commodity boneless and whole bird chicken as well as chicken leg quarters for sale to retail, foodservice, and international customers.  The Harrisonburg complex was among the poultry operations Tyson acquired in 1989, when it purchased Holly Farms.

The company plans to gradually increase poultry production in the complex, using more of its existing capacity.  In addition, the company plans to substantially retain the people employed by Tyson and honor the contracts with local poultry growers, Gary George, CEO of George’s,  said.

Meanwhile, the U.S. Department of Justice (DOJ) filed a civil antitrust suit challenging George’s acquisition of the Tyson complex.  The DOJ lawsuit filed in U.S. District Court in Harrisonburg requests that the court declare the acquisition to be unlawful under the antitrust laws and order appropriate equitable relief, such as divestiture of the Harrisonburg complex.  “The department’s lawsuit alleges that George’s acquisition of Tyson’s Harrisonburg chicken processing facility would reduce growers’ ability to receive competitive prices for their services,” said Christine Varney, assistant attorney general in charge of the DOJ’s antitrust division.  Prior to the acquisition, Tyson Foods, George’s, and JBS-Pilgrim’s Pride competed in Virginia’s Shenandoah Valley region for the services of local chicken growers.  The Tyson sale decreased the number of processors in the area to two, reducing competition for grower services, according to DOJ.

The acquisition was not required to be reported under the Hart-Scott-Rodino Antitrust Improvement Act of 1976 because the purchase price of the transaction was less than the minimum reporting threshold.

 

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