Virginia-based meat group Smithfield Foods has announced the completion of its US$571m acquisition of the branded meats business of ConAgra Foods, subject to certain post-closing adjustments.

The deal is now a totally cash transaction. Smithfield had originally said that $100m of its common stock would be part of the purchase package but Smithfield and ConAgra Foods subsequently agreed to an amendment to the original agreement, reducing the purchase price by $4m and making it an all-cash deal.

The ConAgra branded meats business, with sales of around $1.8bn, includes the packaged meats and turkey products sold under the Armour, Butterball, Eckrich, Margherita, Longmont and LunchMakers brands, which are sold in retail grocers, delis, restaurants and other foodservice establishments.

The acquisition is split into two parts. The Butterball turkey business has been acquired for $235m by Butterball, LLC (formerly known as Carolina Turkeys), a joint venture between Smithfield Foods and Maxwell Farms. Smithfield owns 49% of Butterball, LLC. In addition, Smithfield has bought the other branded packaged meats assets from ConAgra Foods for $246m.

“This acquisition is a terrific strategic fit for Smithfield,” said C. Larry Pope, Smithfield’s president and CEO. “We are now a partner in the largest turkey business in the US that adds to our multi-legged stool in terms of our protein portfolio, providing stability of financial performance and diversity in our product mix.”

Pope continued: “Butterball is a national brand with impressive brand equity. We also are adding 600m pounds of packaged meats, almost all of which are branded, with large market shares in hot dogs, dinner sausages and luncheon meats. This immediately advances our strategy of growing our packaged meats business, utilising raw material internally, as well as migrating to higher margin, convenience products.”

ConAgra Foods’ chief executive officer Gary Rodkin said the deal enabled ConAgra to increase its focus on priority brands and pursue additional cost-reduction efforts earlier than originally expected.