UPDATE: 5/29/14, 9:10 a.m. EDT. Tyson Foods, advised by Davis Polk & Wardwell global M&A cohead George Bason Jr., capital markets cohead Richard Truesdell Jr. and corporate partner Marc Williams, has stepped in and made a $6.8 billion offer for Hillshire Brands.
Pilgrim’s Pride, a unit of Brazilian beef and poultry giant JBS, said Tuesday it has made a $6.4 billion cash-and-stock bid to acquire Hillshire Brands.
The offer is aimed at derailing Hillshire’s pending $4.3 billion offer to buy Pinnacle Foods. Announced earlier this month, that potential deal has yielded roles for Simpson Thacher & Bartlett and Skadden, Arps, Slate, Meagher & Flom, according to our previous reports.
Greeley, Colo.–based Pilgrim’s has turned to Cravath, Swaine & Moore corporate partners Scott Barshay and Damien Zoubek as outside counsel on its proposed Hillshire purchase. Barshay, who heads Cravath’s corporate department, did not immediately respond to a request for comment about whether his firm has handled work for the company or its São Paulo-based parent in the past.
Cravath does have some experience handling corporate work tied to the country set to host the 2014 World Cup soccer tournament starting next month. The firm served as U.S. counsel to Brazilian poultry and pork processor Sadia on its sale to São Paulo-based rival Perdigao in 2009. That transaction came the same year that JBS—the world’s largest meat producer—tapped Shearman & Sterling as counsel when it acquired a majority stake in then-bankrupt Pilgrim’s for $800 million.
Weil, Gotshal & Manges served as Pilgrim’s Chapter 11 counsel on that deal, while Baker & McKenzie took the lead corporate role for the company, according to our previous reports. U.S. Senate lobbying records show that Baker & McKenzie, which also handled Pilgrim’s $1.1 billion acquisition of Gold Kist in 2006, has received $170,000 from the company over the past year to advise on federal immigration legislation.
Bloomberg reports that JBS has spent $17 billion over the past decade to overtake Tyson Foods as the meat industry’s leading player. Last week JBS filed plans for an initial public offering for its Brazilian operations and the company agreed last year to pay up to $3 billion in cash and assumed debt for the Seara Brasil poultry unit of rival Marfrig Alimentos.
Barbosa, Müssnich & Aragão—one of Brazil’s top firms, according to a 2010 American Lawyer feature story—took the lead for JBS on that deal, while local rival Lefosse Advogados served as counsel to Marfrig. (Mariane Muffo Rangel Pereira, an attorney with Barbosa Müssnich, was a visiting attorney in Cravath’s M&A department in 2012 and 2013.)
Pilgrim’s push to acquire Hillshire would require the target to pay a $163 million termination fee to scuttle its deal with Pinnacle. Hillshire, a suburban Chicago-based successor to former consumer goods giant Sara Lee Corp., has said in a statement that it will evaluate the unsolicited bid. (Skadden is continuing to serve as outside legal adviser to Hillshire, whose general counsel is Kent Magill.)
This week’s food-related transactional activity wasn’t confined to Tuesday’s meat-centric M&A machinations.
In Australia, private equity firm Pacific Equity Partners has turned to Asia Pacific legal giant Allens for counsel on its roughly $930 million sale of the Peters Food Group—one of the oldest food brands Down Under—to R&R Ice Cream, which has retained Allen & Overy to advise on the matter.
And sibling publication The Asian Lawyer reports that Magic Circle rival Freshfields Bruckhaus Deringer is advising Chinese state-owned dairy giant Bright Foods on its $960 million purchase of a 56 percent stake in Israel’s Tnuva Foods from private equity firm Apax Partners, which is being advised by Israeli firm Herzog Fox & Neeman.
Apax is part owner of ALM Media LLC, the parent company and publisher of The Am Law Daily, which reported last year on Herzog Fox’s ties to an Israeli spy scandal.