SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 18, 1997
SMITHFIELD FOODS, INC.
(Exact name of registrant as specified in its charter)
VIRGINIA 0-2258 52-0845861
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
999 WATERSIDE DRIVE
SUITE 900
NORFOLK, VIRGINIA 23510
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number, including area code (757) 365-3000
FORM 8-K DECEMBER 18, 1997 PAGE 1
<PAGE>
ITEM 5. OTHER EVENTS
Smithfield Foods, Inc. (the "Company" or "Smithfield Foods") announced
on December 18, 1997 that the Company has reached an agreement with the members
of the Schneider Family who control approximately 74% of the voting shares of
Schneider Corporation (Toronto:SCD.TO) on the terms of a proposed offer to
purchase such shares which the family members have irrevocably agreed to accept.
Under the proposed offer, Smithfield Foods will offer to acquire any
and all Common Shares and Class A Shares of Schneider on the basis of .5415 of
an exchangeable share of a newly incorporated, wholly-owned Canadian subsidiary
of Smithfield Foods. Each whole exchangeable share may be exchanged for one
share of common stock of Smithfield Foods. For purposes of establishing the
exchange ratio, the parties have agreed on a value for the Schneider shares of
Cdn. $25 per share and of U.S. $32.50 for each Smithfield Foods common share.
The exchangeable shares will have voting, dividend and liquidation rights that
are, as nearly as practicable, equivalent to those of the Smithfield Foods
common stock. The exchange offer is intended to provide a tax-free rollover to
Schneider's Canadian shareholders.
The terms and conditions of the offer are to be set forth in a
registration statement that will be filed promptly with the Securities and
Exchange Commission. The exchange offer will commence after the registration
statement is declared effective by the SEC. The exchange offer will be
conditional upon, among other things, the receipt of all necessary governmental
and regulatory approvals and consents and the absence of material adverse
changes in Schneider Corporation.
The foregoing is qualified entirely by reference to the Press Release
of the Company issued on December 18, 1997, which is attached hereto as Exhibit
99.1 and is incorporated herein by reference.
FORM 8-K DECEMBER 18, 1997 PAGE 2
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits.
Exhibit 99.1 Smithfield Foods, Inc. Press Release issued on
December 18, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SMITHFIELD FOODS, INC.
(Registrant)
By: /s/ Aaron D. Trub
-----------------------------
(Signature)
Aaron D. Trub
Vice President, Secretary and
Treasurer
Dated: December 23, 1997
FORM 8-K DECEMBER 18, 1997 PAGE 3
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
For More Information
Smithfield Foods, Inc.
Aaron D. Trub
757-365-3000
SMITHFIELD FOODS REACHES AGREEMENT WITH
CONTROLLING SHAREHOLDERS OF SCHNEIDER CORPORATION
Norfolk, Virginia, December 18, 1997 - Smithfield Foods, Inc.
(NASDAQ:SFDS) today announced that it has reached an agreement with the members
of the Schneider Family who control approximately 74% of the voting shares of
Schneider Corporation (Toronto:SCD.TO) on the terms of a proposed offer to
purchase such shares which the family members have irrevocably agreed to accept.
Under the proposed offer, Smithfield Foods will offer to acquire any
and all Common Shares and Class A Shares of Schneider on the basis of .5415 of
an exchangeable share of a newly incorporated, wholly-owned Canadian subsidiary
of Smithfield Foods. Each whole exchangeable share may be exchanged for one
share of common stock of Smithfield Foods. For purposes of establishing the
exchange ratio, the parties have agreed on a value for the Schneider shares of
Cdn. $25 per share and of U.S. $32.50 for each Smithfield Foods common share.
The exchangeable shares will have voting, dividend and liquidation rights that
are, as nearly as practicable, equivalent to those of the Smithfield Foods
common stock. The exchange offer is intended to provide a tax-free rollover to
Schneider's Canadian shareholders.
The terms and conditions of the offer are to be set forth in a
registration statement that will be filed promptly with the Securities and
Exchange Commission. The exchange offer will commence after the registration
statement is declared effective by the SEC. The exchange offer will be
conditional upon, among other things, the receipt of all necessary governmental
and regulatory approvals and consents and the absence of material adverse
changes in Schneider Corporation.
Smithfield Foods has learned that in response to its offer, Schneider
Corporation has waived the application to its proposed offer of the Schneider
Shareholder Rights Plan.
Smithfield Foods has stated that it intends to account for this
transaction on a "pooling of interests" basis under the United States generally
accepted accounting principles.
FORM 8-K DECEMBER 18, 1997 PAGE 4
<PAGE>
"Schneider Corporation is a natural fit for Smithfield Foods," Joseph
W. Luter, III, chairman and chief executive officer, said. "The acquisition of
Schneider extends our market penetration into Canada and makes Smithfield Foods
an international player," he stated. The addition of the Schneider brand, which
is the number one processed meats brand in Canada, meshes well with Smithfield's
strategy to sharply increase the processed meats area of its business as well as
its efforts to become a more marketing driven company.
Schneider products include bacon, hams, sausages, specialty sausage,
wieners, sliced meats, deli meats and grocery entrees. Schneider had sales of
Cdn. $813.4 million in its fiscal year ended October 25, 1997.
Luter said that Schneider, like the Company's other major subsidiaries,
will have a great deal of autonomy in operating its business. "The strengths
that each company brings to the other, as well as certain profit-enhancing
synergies inherent in the transaction, will make both more profitable going
forward," Luter stated.
Luter said he expects that Schneider will be accretive to Smithfield
Foods' earnings in fiscal 1999.
Smithfield Foods is the largest vertically integrated producer and
marketer of fresh pork and processed meats in the United States. The Company's
brands include Smithfield Lean Generation Pork, Smithfield Premium, Gwaltney,
Patrick Cudahy, John Morrell, Lykes, Esskay, Kretschmar, Valleydale, Jamestown,
Dinner Bell, Realean, Patrick's Pride, Great, Tobin's First Prize, Peyton's and
others. Smithfield Foods had sales of $3.87 billion for the fiscal year ended
April 27, 1997.
This news release is neither an offer to exchange nor a solicitation of
an offer to exchange shares of capital stock of Smithfield Foods. Such
securities may not be sold or exchanged nor may offers to buy or exchange be
accepted prior to the time the registration statement becomes effective.
This news release may contain "forward-looking" information within the
meaning of the federal securities laws. The forward-looking information may
include, among other information, statements concerning Smithfield Foods'
outlook for fiscal 1998 and beyond, as well as statements describing the
anticipated synergies of the proposed acquisition of Schneider and their effect
on the profitability of Smithfield Foods. There may also be other statements of
beliefs, future plans and strategies, anticipated events or trends and similar
FORM 8-K DECEMBER 18, 1997 PAGE 5
<PAGE>
expressions concerning matters that are not historical facts. The
forward-looking information and statements in this news release are subject to
risks and uncertainties, including availability and prices of raw materials,
product pricing, competitive environment and related market conditions,
operating efficiencies, access to capital and actions of governments, that could
cause actual results to differ materially from those expressed in or implied by
the information or statements.
FORM 8-K DECEMBER 18, 1997 PAGE 6
