Tyson Foods announced yesterday that it has reached a deal with the U.S. Department of Justice to sell its hog-purchasing business as part of its planned $7.7 billion acquisition of Hillshire Brands. The settlement ends the antitrust review period of the merger, Tyson said in a statement.
The Justice Department announced on Wednesday that it would require Tyson Foods Inc. to divest Heinold Hog Markets, its sow purchasing business, in order to win antitrust approval for the merger. The antitrust division said in a statement that, without the required divestiture, the transaction would have combined companies that account for more than a third of sow purchases from U.S. farmers, thereby likely reducing competition for purchases of sows from farmers.
Under the terms of the agreement, Tyson must sell Heinold Hog Markets, which had annual sales of about $270 million and employs about 45 people. The business is a unit of Tyson Hog Markets, and the companies agreed to operate it as an independent, competitive business until a buyer who is satisfactory to the antitrust division is found.
The combination of Tyson Foods and Hillshire Brands creates a single company with more than $40 billion in annual sales and a portfolio that include recognized brands such as Tyson®, Wright®, Jimmy Dean®, Ball Park®, State Fair® and Hillshire Farm®, according to a Tyson news release.
Tyson also announced that a new leadership team has been selected and includes a mix of existing senior leaders from Tyson Foods and Hillshire Brands.
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Andy Callahan, former president of Hillshire’s retail business, will manage all retail consumer brands, including the legacy Hillshire consumer brands (such as Jimmy Dean®, Ball Park®, Hillshire Farm® and Sara Lee®), Tyson’s consumer brands (such as Tyson® frozen, value-added poultry and Wright® Brand bacon) and Hillshire’s Gourmet Food Group.
- Sally Grimes, former chief innovation officer and president of Hillshire’s Gourmet Food Group, will lead Tyson’s innovation (including research and development), sales and global brand strategy teams to support all products sold through retail channels and to maximize global growth of our consumer brands.
- Donnie King, former president-Prepared Foods, Customer and Consumer Solutions for Tyson Foods, will oversee Tyson’s legacy poultry, fresh meats, and non-branded prepared foods businesses as well as the combined Tyson Foods and Hillshire foodservice businesses. Those reporting to him will include Steve Stouffer who will lead fresh meats; Noel White who will lead poultry; Wes Morris who will lead prepared foods operations; and Tom Hayes, currently chief supply chain officer for Hillshire Brands, who will lead the combined Tyson and Hillshire foodservice businesses.
- Those continuing to report to Donnie Smith will include David Van Bebber, who leads the Tyson legal team; Sara Lilygren, who leads corporate affairs; Dennis Leatherby, who continues as the company’s chief financial officer; Hal Carper, who heads strategy and new ventures; Mike Roetzel, who oversees operations services; and Russell Tooley, who heads the company’s business process and continuous improvement practice.
- Ken Kimbro, who has led Tyson Foods’ human resources functions since 2001, will be transitioning into retirement. He will be replaced by Mary Oleksiuk, former chief human resources officer for Hillshire Brands.
- Malik Sadiq, senior vice president-Asia Pacific, will oversee Tyson International on an interim basis. He takes the place of James Young who will be transitioning to the company’s Cobb-Vantress breeding stock subsidiary in the coming months.
