Cargill and another company have teamed up to buy one of the largest poultry producers in the country.
Wayzata-based Cargill formed a joint venture with Continental Grain to acquire Sanderson Farms for $4.53 billion, paying $203 per share, a news release says.
When this transaction is complete, they'll combine Sanderson Farms with Wayne Farms, a subsidiary of Continental Grain, to form a new, privately held poultry business.
The release says this new company will be "well positioned to enhance its service to customers across retail and foodservice and drive organic growth in an industry fueled by affordability and key consumer trends around the health, sustainability, and versatility of chicken."
This comes as the price of chicken is soaring due to increased demand and a labor shortage. The Wall Street Journal reported in May the popularity of spicy fried chicken sandwiches and hot wings have driven demand for poultry, leading to some restaurants being out of chicken for weeks because there aren't enough workers to increase production.
“Expanding our poultry offerings to the U.S. is a key enabler of our ability to meet customer and consumer demands. With these great businesses, and our strong partnership, we believe we will deliver a superior portfolio of products and services to our customers," Cargill Chairman and CEO David MacLennan said in a statement.
Wayne Farms CEO Clint Rivers will lead the new company. And Sanderson Farms will become a private company.
This deal is expected to close by the end of this year or early next year, pending stockholder approval.