Smithfield Foods, the US pork giant, has raised $522M after pricing its IPO below range


The Smithfield feed processing mill producing food for nearby hog-raising farms. Milford, Utah.
Smithfield, a feed-processing mill located in Milford Utah, produces food for nearby hog farms. .

Jon G. Fuller via Getty Images / VW Pics

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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leadzevs/ author of the article

LeadZevs (John Lesley) is an experienced trader specializing in technical analysis and forecasting of the cryptocurrency market. He has over 10 years of experience with a wide range of markets and assets - currencies, indices and commodities.John is the author of popular topics on major forums with millions of views and works as both an analyst and a professional trader for both clients and himself.