Smithfield CEO feels Senate heat over sale to China
By Doug Palmer
WASHINGTON (Reuters) - U.S. senators sought answers from the head of Smithfield Foods SFD.N on Wednesday about whether the proposed sale of the Virginia ham maker to China's largest pork producer could hurt U.S. food safety and raise prices for American consumers.
Although there was no indication Congress would intervene to block the deal, Senate Agriculture Committee Chairman Debbie Stabenow said she was worried that it would undermine the long-term competitiveness of the U.S. pork industry by exporting valuable production techniques to China.
"This is a precedent-setting case and we owe it to consumers, producers and workers to ensure we are asking the right questions and evaluating the long-term implications," the Democrat said at the hearing with Smithfield President and CEO Larry Pope.
Since more Chinese purchases of U.S. food companies appear to be likely, "at what point are we willing to say it's not in America's interest to have our food processing industry owned by another country," Stabenow told reporters after the hearing.
The sale of Smithfield Foods, the world's largest pork producer with more than 46,000 employees in 25 states and four countries, to Shuanghui International Holdings for $4.7 billion would be the biggest Chinese takeover of a U.S. company to date.
'SAME OLD SMITHFIELD'
The Smithfield, Virginia-based company makes ham, sausage, bacon and other prepared meats under labels including Eckrich, Gwaltney and Armour. It has argued the deal is good for United States because it will boost pork exports, and good for China because it will help meet the country's growing demand for pork as hundreds of millions of Chinese move into the middle class.
But some have questioned what kind of production practices Shuanghui could bring to the United States, especially after revolting images this year of thousands of rotting pig carcasses floating down the Huangpu River that runs through Shanghai raised concerns about food safety practices in China. Continued...