Sanderson Farms Shares Halted; Deal With Regulators Said Near

By Colin Kellaher

Trading in shares of Sanderson Farms Inc. is halted premarket Friday amid growing speculation that U.S. regulators will approve the $4.5 billion acquisition of the poultry processor.

The Wall Street Journal earlier this week reported that the Justice Department was in talks with Cargill Inc. and Continental Grain Co., which last year agreed to pay $203 a share for Sanderson, on potential concessions that could pave the way for the deal to close.

Sanderson last month said the deal wouldn't close by the end of June as expected, as regulators continued to review the possible effects on competition in the poultry sector, and warned that the companies might not satisfy the closing conditions to the deal by the Aug. 8 termination date.

Sanderson shares have traded above the takeover price, rising to as high as $221.63 on June 28, amid speculation that the deal, which some investors have said undervalues the company, might fall apart. The stock ended Thursday's session at $204.

The acquisition of Sanderson by agribusiness giant Cargill and agricultural investment firm Continental would combine the third-largest U.S. chicken company with Wayne Farms LLC, a poultry company owned by Continental, to form a new company representing roughly 15% of U.S. chicken production.

--Patrick Thomas contributed to this report.

Write to Colin Kellaher at colin.kellaher@wsj.com

(END) Dow Jones Newswires

July 22, 2022 06:46 ET (10:46 GMT)

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