Smithfield Foods seeks up to $10.7 billion valuation in US IPO
FILE PHOTO: The Smithfield Foods pork plant is seen in Sioux Falls, South Dakota, U.S., April 16, 2020. REUTERS/Shannon Stapleton/File Photo
:Smithfield Foods is targeting a valuation of up to $10.73 billion in its New York flotation, the Farmland bacon maker said on Tuesday, moving closer to its much-anticipated U.S. stock market return after more than a decade.
Hong Kong-based WH Group, the world's largest pork producer, is spinning off Smithfield into a listed company, as it looks to create a separate fundraising platform for its U.S. and Mexico businesses.
Smithfield and WH Group are each offering 17.4 million shares, priced between $23 and $27 each, to raise up to $939.6 million.
The IPO is set to be the largest U.S. listing by a food company since Swedish oatmilk maker Oatly Group AB's $1.6 billion flotation in 2021, according to data compiled by LSEG.
"As the first major consumer IPO this year, Smithfield will be closely watched. Success of the deal could pave the way for other IPOs across industries, in particular if the deal performs well initially," IPOX CEO Josef Schuster said.
The valuation target is roughly double Smithfield's $5.38 billion net asset value as of Sept. 30.
Smithfield was founded in 1936 in its namesake town by the Luter family as a small meat-packing company. A series of acquisitions starting in the 1980s hoisted it as the largest U.S. pork producer.
The company, which competes with Tyson Foods and Hormel Foods, produces packaged meats and pork products under the brands such as John Morrell, Cook's and Gwaltney.
Smithfield, which carved out its European business last year, traded on the New York Stock Exchange from 1999 until 2013, when WH Group acquired it for $4.7 billion — then the biggest Chinese takeover of a U.S. firm.
Its customers include retailer Walmart and fast-food giant McDonald's.
Smithfield will list on the Nasdaq under the symbol "SFD."
WH Group will maintain control of Smithfield post-IPO. Morgan Stanley, BofA Securities and Goldman Sachs are the lead underwriters.
Smithfield plans to use the IPO proceeds to beef up infrastructure, automation and capacity expansion.
