Smithfield-Shuanghui marriage a done deal (commentary)

Smithfield-Shuanghui marriage a done deal (commentary)

DID you get your invitation to the nuptials, yet? It's probably somewhere in the mail.

Smithfield Foods' $4.7 billion sale to Shuanghui International cleared all hurdles. The feds okayed it, the shareholders approved it and Starboard decided not to pursue hostile action.

All that remains to be done now is the formal handing over of the keys to the front door, and Smithfield chief C. Larry Pope will probably schedule a meeting with Shuanghui chief executive Wan Long to do that ASAP.

On Sept. 24, Smithfield shareholders voted overwhelmingly to accept Chinese ownership of one of the most iconic businesses in America. Ninety-six percent voted yes, and the deal closed soon after the shareholder vote.

I'm guessing Wan bought his first-class ticket from Shanghai, China, to Smithfield, Va., five minutes after the votes were tallied.

Now, let's follow the money.

Meatingplace magazine reported that Smithfield executives, Pope included, "stand to make millions on the sale. The executives have repeatedly tried to reassure critics that nothing will change in the way Smithfield does business or the company's senior leadership."

Pope doesn't need the millions. About 10 years ago, answering a question from the crowd at a National Meat Assn. event about a threat to his leadership, he said, "I'm too old to care and too rich to scare."

At his place in life, more money is a way to keep score, not a financial necessity.

Still, I'm sure a few of those in senior leadership positions will be tempted to cash in and retire.

The tiny town of Smithfield is likely to see an influx of Chinese nationals, though, and perhaps the addition of a few restaurants more akin to genuine Chinese haute cuisine than Hunan Express or Asian Grill — two of the current local favorites. Just don't expect much more.

The Chinese company bought Smithfield's food safety expertise — something sorely lacking in China — and their technicians will scour Smithfield's plants and hazard analysis plans for best practices.

They're also envious of the Smithfield brand, which Chinese consumers hold in high regard. It will be protected, at all costs.

Will we see imported hogs arriving stateside on a slow boat from China? When pigs fly.

One of Smithfield's big brags is the quality of its herd. Most likely, the American genetics will be carried to China to help improve its much larger but poor-quality national herd.

Also, the other shoe should drop. Now that China's businesspeople know they can make major purchases of American businesses without serious federal intervention, many U.S.-based food companies will suddenly develop a "yen" for the yen.

*Chuck Jolley is president of Jolley & Associates, a marketing and public relations firm that concentrates on the food industry.

Volume:85 Issue:41

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