The Mexican Federal Economic Competition Commission has cleared the proposed sale of Tyson de Mexico to Pilgrim’s. With the clearance, the final regulatory approval required for closing has been completed, and Pilgrim’s and Tyson will work to complete the deal as soon as possible.
The two companies announced the proposed transaction, where Pilgrim’s would acquire Tyson Foods’ Mexican operations in July 2014. Tyson de Mexico as an estimated annual revenue of $650 million, and the acquisition was valued at $400 million.
"We appreciate the attention and efforts of the Commission and will now move forward with Pilgrim's Pride to complete the deal," said Tyson President and CEO Donnie Smith. "We've not set a closing date but believe it will be soon."
Based in Gomez Palacio in North Central Mexico, Tyson de Mexico employs more than 5,400 people in its offices, three plants and seven distribution centers.
“We are excited to welcome members of Tyson de Mexico to the Pilgrim’s family,” said Bill Lovette, CEO of Pilgrim’s. "Beyond growth, this transaction will also provide Pilgrim's with geographic diversity in Mexico through the addition of new facilities in the northern part of the country to complement our existing facilities, enhance our portfolio through more value added and branded products including the Del Dia brand, and increase our total Mexico sales. Mexico is a key piece of our strategy and we view the country as a proxy of other developing economies' future demand for higher protein consumption."
Tyson Foods stated that after the sale is completed, Tyson will continue to serve customers in Mexico, as the company will supply the country with U.S. produced chicken as well as chicken produced in Mexico, in part through a co-packaging arrangement with Pilgrim’s.