The Hillshire Brands Co. says it will begin talks with Pilgrim's Pride and Tyson Foods after each made multibillion dollar offers to acquire the Chicago-based food company.
Pilgrim's Pride initially offered $45 per share, or $5.58 billion, late last month for Hillshire before Tyson Foods countered two days later with a $50 per share, or $6.2 billion, proposal. Then on Sunday, Pilgrim's Pride raised its offer to $55 a share, or $6.82 billion.
Hillshire said in a statement Tuesday that its board of directors met with legal and financial advisers before deciding to "conduct separate discussions" with the two companies "with regard to their recent unsolicited proposals." The board has not made any recommendation with regard to either company's bids.
The offers come after Hillshire announced a $4.23 billion bid to buy Pinnacle Foods. The Tyson and Pilgrim's Pride offers are "conditioned on the termination of the Pinnacle Foods merger agreement," Hillshire said in a statement.
"Hillshire Brands does not have the right to terminate the Pinnacle Foods merger agreement on the basis of either of these proposals or enter into an alternative acquisition agreement with either of these parties prior to termination," the statement noted. "There can be no assurance that any transaction will result from these proposals."
The board of directors has not taken any action on its offer for Pinnacle Foods and is not "proposing to do so," the statement added.
Hillshire's products include Ball Park hot dogs and Jimmy Dean sausages. Pinnacle makes Birds Eye frozen vegetables, Duncan Hines cakes mixes and Hungry-Man frozen dinners. Tyson is one of the world's largest producers of meat and poultry with $34.4 billion in fiscal 2013 sales. Colorado-based Pilgrim's is the second-largest chicken producer in the world and is owned by JBS S.A., the world's largest protein company.