Chicken producer Sanderson Farms Inc is exploring a sale, according to a source familiar with the matter, at a time demand for its products is on the rise as restaurants reopen for business.
Sanderson Farms has drawn interest from buyers including agricultural investment firm Continental Grain Co, which owns a smaller chicken processor, Wayne Farms, the source said.
The deal would form a company producing about 15% of the country’s chicken meat. The second-largest company, Pilgrim’s Pride Corp, produces about 16%, according to the Wall Street Journal, which first reported the news.
Prices of chicken products, especially those of wings and breasts, have risen as easing restrictions are bringing consumers back to restaurants and more fast-food chains are battling to create fried chicken sandwiches.
Last year, Sanderson Farms said it had rejected an unsolicited proposal from Durational Capital Management, a new shareholder, for $142 per share, as it undervalued the company.
The Laurel, Mississippi-based company has a market share of about $3.5 billion.
Source: Reuters.com