Tyson Foods, Hillshire Complete $8.5B Merger

by Lance Turner  on Thursday, Aug. 28, 2014 4:13 pm  

Tyson Foods Inc. of Springdale on Thursday said it had completed its $8.5 billion purchase of Hillshire Brands of Chicago, a day after the companies reached a proposed settlement with the U.S. Department of Justice over antitrust concerns.

The publicly traded meat processor announced the completion of the merger in a news release, and said the combination "positions Tyson Foods as a clear leader in the prepared foods business."

"As of today, Tyson Foods and Hillshire Brands are officially together in one great company," Tyson Foods CEO Donnie Smith said. "Part of our strategic growth plan has been to shift toward higher-margin prepared and branded foods. This transaction gives us a portfolio of complementary, proven brands as a new springboard and accomplishes in a short time what would have taken us years to build on our own."

Tyson Foods said the combination of companies creates a single entity with more than $40 billion in annual sales and a portfolio that includes the Tyson, Wright, Jimmy Dean, Ball Park, State Fair and Hillshire Farm brands.

Tyson Foods expects the deal to generate synergy savings of $225 million in fiscal 2015 and more than $500 million by fiscal 2017.

Tyson Foods also announced a new leadership team that includes a mix of senior leaders from Tyson Foods and Hillshire Brands:

  • Andy Callahan, former president of Hillshire's retail business, will manage retail consumer brands, including the legacy Hillshire consumer brands, Tyson's consumer brands 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, sales and global brand strategy teams to support all products sold through retail channels.
  • Donnie King, former president of Tyson's prepared foods, customer and consumer solutions, 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.

Tyson Foods also said that Ken Kimbro, who has led the firm's human resources functions since 2001, will retire. He will be replaced by Mary Oleksiuk, former chief human resources officer for Hillshire Brands.

The company said Malik Sadiq, senior vice president-Asia Pacific, will oversee Tyson International on an interim basis. He takes the place of James Young, who will move to Tyson's Cobb-Vantress breeding stock subsidiary.

Sean Connolly, former president and CEO of Hillshire Brands, "has chosen to pursue other interests," the company said. He will consult during the integration process.

 

 

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