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TAKEAWAYS PRINCIPALS
- Smithfield Foods and its Chinese parent raised around $522 million from the U.S. pork giant's initial public offering after pricing shares below their marketed range.
- The IPO marks a return to a U.S. listing for the Smithfield, Va.-based company, which went private when China's WH Group acquired it for almost $5 billion in 2013.
- Hong Kong-listed WH Group will continue to own about 90% of Smithfield, which is expected to begin trading on the Nasdaq Tuesday under the ticker "SFD."
Smithfield Foods, the U.S. pork company’s Chinese parent, raised $522m from its initial public offering.
This IPO is a return of the Smithfield (Va.)-based company to a U.S. listed. The Smithfield Company went private in 2013 when China’s WH Group bought it for almost $5 billion. Its pricing, however, signals that the company had overestimated demand for the IPO, which is hitting the market as bankers prepare for an expected boom in deals this year.
On Tuesday, Smithfield and Chinese owner WH Group priced a total of nearly 26.1 million shares at $20 each. Originally, the two companies had offered up to 34.8 millions shares between $23 and $27 each.
WH Group Continues to Control Majority in Smithfield
WH Group's acquisition of Smithfield over a decade ago was then the biggest purchase by a Chinese firm of a U.S. one, according to Dealogic data. Hong Kong’s listed company will still own 90% of Smithfield.
Smithfield also produces packaged meats under Eckrich’s Famous brand, Farmer John, Nathan’s Famous Brand, and its namesake. Smithfield will begin trading under the Nasdaq ticker on Tuesday. “SFD.”
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