Dive Brief:
- Pinnacle Foods has terminated its agreement to be acquired by Hillshire Farms, thus clearing the way for Tyson Foods to buy Hillshire.
- Tyson's $7.7 billion bid for Hillshire was dependent upon Pinnacle and Hillshire canceling their $4.3 merger deal.
- Pinnacle, maker of brands such as Vlasic pickles and Wish-Bone salad dressings, will now collect a $163 million break-up fee from Hillshire. Pinnacle says it will use that cash to pay down debt.
Dive Insight:
When Hillshire decided it would rather be bought by Tyson than to buy Pinnacle, it put Hillshire into a bit of a pickle with the pickle maker. Pinnacle had an option to accepting the $163 million break-up fee. But it could have instead forced a shareholder vote and delayed the Tyson-Hillshire deal .... unless Hillshire came up with a larger break-up payment.
That's what we and many investors expected, but it seems that Pinnacle took the high road.