Washington, DC, United States (4E) – Smithfield Foods Inc. announced U.S. regulators have given the green light for the world’s largest hog and pork producer to be purchased by China’s Shuanghui International Holdings Ltd., a deal that would mark the largest Chinese acquisition of an American firm.
The Committee on Foreign Investment in the U.S. (CFIUS) gave its nod to the deal and shareholders in Smithfield are set to vote on the transaction on Sept. 24. The deal will likely be completed soon after it is approved.
The Hong Kong-based Shuanghui said on May 29 that it would offer $4.72bn to buy Smithfield. However, the deal has had its critics from both political parties in the U.S. Congress, demanding a “thorough review” of the plan.
Officials from Smithfield and Shuanghui said that the deal was about shipping Smithfield products to meet China’s increasing demand for pork. Legal experts from CFIUS had expected the U.S. government to clear the deal because it did not pose significant risks to national security.
Over the past four years, CFIUS has blocked at least three deals that would have led Chinese firms to acquire assets near military facilities. Opposition from CFIUS has also resulted to Huawei Technologies Co. and Bain Capital Partners LLC abandoning plans to bid for the purchase of 3Com Corp. in 2008.