Smithfield Foods IPO pricing falls short of expectations
USA – Smithfield Foods has priced its initial public offering (IPO) at US$20 per share, lower than the earlier estimated range of US$23 to US$27.
The US meat processor will raise approximately US$521.7 million from the offering, significantly less than the potential US$940 million it could have secured if shares had been priced at the upper end of the initial range.
The company is selling a total of 26.1 million shares, divided equally between its common stock and those held by SFDS UK Holdings, a subsidiary of its parent company, WH Group.
Smithfield Foods, owned by China’s WH Group, is returning to the stock market after operating as a private company for over ten years.
The shares began trading on28th January on the Nasdaq exchange, with the IPO set to close on 29 January.
Market analysts have suggested that concerns over potential tariffs on US imports may have influenced the lower pricing of the IPO.
Smithfield Foods has been adjusting its business structure in recent months, including spinning off its European operations in August to allow regional management to focus on market-specific challenges.
In December, the company transferred part of its hog farming operations to a newly formed venture managed by Murphy Family Ventures.
Despite restructuring efforts, CEO Shane Smith stated that Smithfield has no plans to shut down additional pork processing plants in the US.
The company, which owns brands such as Smithfield, Eckrich, and Nathan’s Famous, continues to monitor trade and immigration policies under President Donald Trump’s administration.
WH Group’s decision to list Smithfield separately comes at a time when the US faces the possibility of tariffs on exports to major pork-consuming nations such as China and Mexico.
Smithfield’s valuation reached US$8.1 billion after its stock saw modest gains on its first trading day.
Before the IPO, the company restructured by exiting contracts with certain US hog farms and shutting down a pork processing plant in California.
Sign up HERE to receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.
