Pilgrim's Pride agrees to acquire GNP Company for $350M in cash
Pilgrim's Pride announced a definitive agreement to acquire GNP Company, a leading provider of premium branded chicken products in the Upper Midwest, in an all cash, $350M transaction. The proposal has the unanimous support of the Pilgrim's board, as well as the support of JBS S.A., the majority owner of Pilgrim's. It is anticipated that the proposed transaction would close during the first quarter of 2017, subject to regulatory review and approval and customary closing conditions. Pilgrim's expects to achieve approximately $20M in annualized synergies, primarily from the optimization of production and distribution, and cost savings in purchasing, production, logistics and SG&A. In addition to operational synergies, the company anticipates capturing an estimated present value of approximately $28M in tax savings and a post synergies EBITDA multiple of 3.9x. Pilgrim's expects the acquisition will be accretive to the company's diluted earnings per share in 2017 and believes that the combined company will have a strong financial position, improved capital structure and substantial cash flow generation capability.