Senators chime in on Smithfield buyout
June 20, 2013
by Meat&Poultry Staff
WASHINGTON –A bipartisan group of US senators is asking the US Department of the Treasury to include potential risks to food safety when the agency reviews the proposed buyout agreement reached between Smithfield Foods Inc. and Shuanghui International Holdings Ltd.
The group included members of the Senate Agriculture Committee. In a letter to Treasury Secretary Jacob Lew, the group said they had not formally taken a position on the proposed acquisition, but urged the Treasury Department to include the US Department of Agriculture and the Food and Drug Administration in any Committee on Foreign Investment in the United States (CFIUS) review process.
"Considering the potential for other foreign acquisitions of American food and agriculture companies, we also have a number of broader questions about how these transactions are reviewed and whether the appropriate authorities are evaluating potential risks and proposing sufficient mitigation measures to protect American interests."
Hong Kong-based Shuanghui, a majority shareholder of China’s largest meat-processing enterprise, entered an agreement to acquire Smithfield, Va.-based Smithfield Foods for approximately $7.1 billion, including assumption of debt. Smithfield is the world's largest pork producer and processor.
"We believe that our food supply is critical infrastructure that should be included in any reasonable person's definition of national security," the senators wrote. "As such, we strongly encourage you to include the Department of Agriculture and the Food and Drug Administration in any CFIUS review of this transaction, and consider designating the Department of Agriculture as one of its lead agencies. Further, any CFIUS review of this transaction should look beyond any direct impact on government agencies and operations to the broader issues of food security, food safety and biosecurity."