Pilgrim's Pride Goes After Gold Kist

The company proposes a $1 billion merger.
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Pilgrim's Pride

(PPC) - Get Report

has made a proposal to acquire fellow chicken processor

Gold Kist

(GKIS)

in a deal valued at around $1 billion.

According to the offer, Pilgrim's Pride would acquire each Gold Kist share for $20. Additionally, Pilgrim's would assume $144 million of Gold Kist's debt.

Gold Kist said that since February, Pilgrim's has made two proposals to acquire the company, but both were rejected. In June, Pilgrim's made an additional proposal to the Gold Kist board.

"Although this proposal was unacceptable as presented to the board and we have great confidence in our strategy as an independent company, our board always considers opportunities to maximize stockholder value," Gold Kist said. However, Gold Kist also said it was "surprised and disappointed that Pilgrim's chose to make public its unsolicited proposal at this time."

Shares of Gold Kist were surging $6.85, or 53%, to $19.78 in premarket trading Monday.