Pilgrim’s Pride borrowing $900M to pay for U.K. foods buy
GREELEY — Pilgrim Pride’s Corp. (Nasdaq: PPC) plans to privately offer $900 million in unsecured notes to help pay for its purchase of the prepared meals business of Ireland-based Kerry Consumer Foods.
The total is an after-the-bell upsize from $750 million announced this morning. The notes pay a yield to maturity of 3.5% and the offering is expected to close Sept. 2.
The meat processor said in June that it would pay about $952 million for the Kerry Foods unit, which sells grab-and-go items or “meats and meals … a significant value-added protein and integrated prepared foods business,” its press release then said. The price was about an 8.5x multiple on the division’s 2021 EBITDA, or earnings before interest, taxes, depreciation and amortization.
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The new debt is guaranteed by some of Pilgrim’s Pride’s wholly-owned U.S. subsidiaries, as its secured credit facility. A term loan draw-down from the latter will provide the rest of the acquisition price. Any other proceeds will go to pay down other secured debt, it said.
Pilgrim’s Pride has about 55,000 employees in 14 states, Puerto Rico, Mexico and Europe. It is 80%-owned by Brasilia-based global meat processor JBS SA, which this month offered to buy the rest of the company for $26.50 a share.
Shares closed Thursday at $27.16 and a $6.6 billion market cap.
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