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National Beef Packing Co. and its majority owner, U.S. Premium Beef LLC, pledged a "vigorous" fight in response to the U.S. Department of Justice's announcement yesterday that it is suing to block the company's $550 million merger with would-be buyer JBS-Swift & Co.
"We are disappointed that the DOJ does not recognize that this transaction is pro-competitive, and we plan to vigorously contest the DOJ's attempt to block it," said Steve Hunt, USPB's chief executive.
The Justice Department said it decided to sue to block the merger between Greeley, Colo.-based JBS-Swift and Kansas City, Mo.-based National Beef -- the nation's third- and fourth-largest beef packers respectively - because it would create the nation's largest beef packer, with control of more than a third of the nation's entire slaughter capacity, and thus reduce competition and pick the pockets of consumers and producers.
On March 4, 2008 USPB and National Beef revealed the news of the agreement under which JBS S.A. would acquire all of the outstanding membership interests of National Beef for $560 million, plus the assumption of all of National Beef's debt and other liabilities at closing.
USBP producer members overwhelmingly voted to approve the transaction on March 14, 2008. Now, consummation of the transaction remains subject to resolving the suit by the DOJ.
U.S. Premium Beef, LLC is the majority owner of National Beef Packing Company, LLC, a leading U.S. beef processor. More than 2,100 producers from 36 states have marketed cattle on USPB's quality-based grids, which are the foundation of National Beef's value-added product lines.
National Beef Packing Co. - with operations in Liberal and Dodge City, Kansas; Brawley, Calif.; Hummels Wharf, Pa.; Moultrie, Ga.; and Kansas City, Kan., processes and markets fresh beef, case-ready beef, and beef by-products for domestic and international markets.