Smithfield adds Butterball turkeys to its growing list of meat products

by Heather Hayes
for Virginia Business
September 2006

Smithfield appears to have a lock on the main course of just about every major holiday.

The $11 billion pork producer plans to pay $575 million for most of the branded meats business of ConAgra Foods Inc. Those brands include Butterball turkeys and Armour hot dogs, as well as other packaged meat products sold under names like Eckrich, LunchMakers, Armour and Longmont. Together, the products have annual sales of $1.8 billion.

C. Larry Pope, president and chief operating officer of Smithfield Foods, says the acquisition supports the company’s strategy of growing its packaged meats business with higher-value, processed and pre-cooked products. This strategy allows the company to utilize its raw materials internally rather than sell them in the commodities market.

Smithfield intends to make the Butterball turkey business part of Carolina Turkeys, a North Carolina-based joint venture between Smithfield and Maxwell Farms Inc. Butterball is the nation’s second largest turkey producer, and Carolina Turkeys is No. 4.

Smithfield officials explained that $325 million of the ConAgra deal will be allocated to Carolina Turkeys. Smithfield will also pay $150 million in cash and offer $100 million in common stock to cover the remaining price of the transaction. The deal is expected to be completed before the end of October.
With its hams, turkeys and hotdogs, Smithfield appears to have Christmas, New Year’s, Thanksgiving and Independence Day covered. So what meat goes with Halloween?