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SMITHFIELD FOODS' PARENT COMPANY CANCELS ITS IPO
BrownfieldAgNews reports:

The Chinese parent of Smithfield Foods has pulled its Initial Public Offering on Hong Kong's Hang Seng exchange.

WH Group was hoping to raise as much as $5.3 billion but the demand just wasn't there. The offer was even reduced in hope of salvaging something but to no avail.

The company stated in its announcement: "In light of deteriorating market conditions and recent excessive market volatility, the company, having consulted the joint sponsors, has decided that the global offering will not proceed at this time."

They will return investors' money.

Last year, WH Group, known then as Shuanghai International paid $4.7 billion for Smithfield in what was the biggest Chinese purchase of a U.S. company ever. The company planned to import U.S. pork into China but U.S. pork prices have been going up and recently China put restrictions on live hogs from the U.S. because of PED virus.

On top of that, Chinese pork prices have fallen because of oversupply.

The WH Group statement can be found here.


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