Spencer, IA: A Smithfield Foods shareholder is suing the company over the company’s proposed acquisition by Chinese meat company Shuanghui International.
The suit, brought by a Florida man, says the deal doesn’t provide “adequate value” to shareholders.
The lawsuit claims the proposed purchase price of $7.1 billion is “unfairly low.” It cites a recent analysis if Starboard Value LLP, which put Smithfield’s worth at between $9 billion and $10.8 billion, if the company was sold in pieces.
The suit also charges that the deal unfairly favors Shuanghui, since it bars Smithfield from seeking other offers.
The deal, which is expected to close in the fourth quarter, must be approved by U.S. regulators and by the company’s shareholders.