The Department of Justice has said that it will allow the sale of Smithfield’s beef business to Brazil’s JBS.
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In March, JBS and Smithfield reached an agreement that would see the Brazilian beef giant acquire Smithfield Beef Group, the fifth-largest US beef producer, for US$565m.
Following the news, shares in Smithfield lifted from an open of $13.53 to close at $15.25 yesterday (20 October).
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By GlobalData
However, the DoJ also announced that it has filed a lawsuit to prevent JBS from buying the National Beef Packing Co, a deal valued at $560 plus the assumption of debt.
The Department said such a deal could lift consumer prices for beef whilst driving down wholesale prices.
