Pigging out: Chinese company to buy Smithfield Foods
Fans of bacon everywhere, take notice: Many of your favorite delicious pork products will soon be produced by a massive Chinese company with a history of tainted-food scares and ties to the government in Beijing.
Yes, that’s right: Smithfield Foods is being purchased by Shuanghui International, China’s largest processor of refrigerated meat products, for a cool $4.7 billion. This news is only a day old, but as of right now there are no plans to reduce company’s workforce of 46,000 or move it from its headquarters in (you guessed it) Smithfield, Virginia.
Shuanghui’s offer, assuming it goes through, would make it the largest ever (planned) sale of an American company to a Chinese firm, and it was announced just yesterday, raising the eyebrows of food safety advocates. Recall that Shuanghui was implicated in a 2011 scandal that revealed a lot of pork on the Chinese market contained a chemical that packs lean meat onto pigs – despite being dangerous to humans.
But two years later, Shuanghui is still standing, thanks in part to its chairman who worked overtime through the episode:
Known as "China's No. 1 butcher" because his company slaughters more than 15 million pigs a year, (Shuanghui Chairman Wan Long) already has a considerable public profile in China as the top official in the country's largest meat producer by market capitalization. He is also a member of China's national legislature, the National People's Congress, as are many other top Chinese executives.
The attention hasn't always been positive. Two years ago Mr. Wan and other Shuanghui executives scrambled to contain fallout from the presence of chemically tainted meat products. He took a prominent role in containing the scandal, apologizing before the public and describing to local media how he arranged to receive daily quarantine reports.
There are still debates about this sale to be had. It will probably be made to pass muster with the Committee on Foreign Investment (CFIUS), an inter-agency governmental body here in the U.S. that has the authority to nix buyouts by foreign companies.
Here’s one question the committee should consider: If Washington has decided that purchasing IT equipment from Chinese companies is against America’s national interest, what would it have to say about letting a Chinese firm take over a large American food producer?
After all, we consume Smithfield’s products. This is bacon we’re talking about here.
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