Tyson Foods is buying Keystone Foods for $2.16 Billion
The latest investment in Keystone is part of its growth strategy and expansion of its value-added protein capabilities.
The acquisition includes six processing plants and an innovation center in the U.S. with locations in Alabama, Georgia, Kentucky, North Carolina, Pennsylvania and Wisconsin. Furthermore, Tyson Foods will also own eight plants and three innovation centers in China, South Korea, Malaysia, Thailand and Australia.
Tyson Foods expects the acquisition to be accretive to GAAP EPS in the third year and accretive to adjusted EPS in the first year excluding transaction-related costs as well as the incremental depreciation and amortization associated with the transaction.
The company expects to generate annual synergies of approximately $50 million by the third year of the acquisition, driven by operational efficiencies, procurement savings, distribution and supply network optimization and other opportunities.
“Keystone is a leading global protein company and will be a great addition to Tyson Foods,” said Tom Hayes, president and CEO of Tyson Foods. “This acquisition will expand our international presence and value-added production capabilities and help us deliver more value to our foodservice customers. Keystone provides a significant foundation for international growth with its in-country operations, sales and distribution network in high growth markets in the Asia Pacific region as well as exports to key markets in Europe, the Middle East and Africa. We look forward to serving customers with these additional capabilities and to welcoming Keystone’s dedicated team members to the Tyson Foods family.”
Keystone Foods is based in West Chester. The company supplies chicken, beef, fish and pork to some of the world’s leading quick-service restaurant chains, as well as retail and convenience store channels. Its portfolio includes chicken nuggets, wings and tenders; beef patties; and breaded fish fillets.
Keystone Foods employs nearly 11,000 people and has an annual revenue of $2.5 billion and Adjusted EBITDA of $211 million in the last 12 months ending June 30, 2018, excluding non-controlling interest and other adjustments.
During the same period, the company generated approximately 65% of its revenue from U.S.-based production and the remaining 35% from its Asia Pacific plants.
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