Pilgrim's Pride offers to acquire Gold Kist for $1bn

08/19/06 - newratings.com

NEW YORK, August 19 (newratings.com) – The second-largest poultry producer in the US, Pilgrim's Pride Corp (PPC), Friday said that it has submitted a bid worth about $1 billion for rival Gold Kist Inc (GKIS).

The Pittsburgh-based company said that it has offered to pay $20 per Gold Kist share, which represents a 54.7% premium to the latter company's closing price on Friday. The total deal price of about $1 billion includes the assumption of $144 million of Gold Kist’s debt, Pilgrim's Pride added. The company expects the acquisition of the Atlanta-based chicken producer to be accretive to its earnings in the first full year, after the closure of the deal. While stating that Pilgrim's Pride has ample cash to fund the transaction, the company's president and chief executive, OB Goolsby Jr, said, "We believe the combination of Pilgrim's Pride and Gold Kist will create the world's leading chicken producer and result in substantial value creation for our respective shareholders, employees, business partners and other constituencies." The company has also expressed its willingness to reconsider the terms of the takeover bid.