Identity Swap for Smithfield's New Chinese Boss
BEIJING (TheStreet) -- This week's decision by Smithfield Food's parent Shuanghui International to recast its identity with a new, more innocuous name -- WH Group -- has set the stage for what could be an initial public offering by the Chinese company later this year on the Hong Kong Stock Exchange.
A marketing makeover might also help American consumers forget the largest U.S. pork processor is now a subsidiary of a Chinese meatpacker with a checkered food-safety record.
"The renaming underscores the company's aspirations to solidify its leading position in the global pork industry, offering consumers worldwide animal protein products meeting high standards in quality, taste, variety and safety," the company said in a Tuesday press release that pictured the new WH logo alongside the old Shuanghui symbol.
Last September, in the largest-ever Chinese takeover of an American company, privately held Shuanghui bought out Smithfield's shareholders for US$ 4.72 billion. It also assumed about US$ 2.38 billion in debt.
According to Chinese media, WH is hoping to raise up to US$6 billion through a Hong Kong IPO as early as April.Smithfield's new owner promised no major changes for the Virginia-based producer and seller of bacon, ham and other pork products under several brand names including Gwaltney, Armour and Farmland. Plans call for selling more Smithfield products in China, the world's leading pork-eating nation.
But critics of the buyout have pointed to China's years of food safety problems, including a Shuanghui scandal that rocked the country three years ago, and potential risks for American consumers.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV