Tyson Foods buys Keystone Foods for $2.16 billion

Tyson Foods has reached a definitive agreement to buy the Keystone Foods business from Marfrig Global Foods for $2.16 billion in cash. The acquisition of Keystone, a major supplier to the growing global foodservice industry, is Tyson Foods’ latest investment to advance its growth strategy and expansion of its value-added protein capabilities.

Headquartered in West Chester, Pa., Keystone supplies chicken, beef, fish, and pork to some of the world’s leading quick-service restaurant chains, as well as retail and convenience store channels. Its value-added product portfolio includes chicken nuggets, wings, and tenders; beef patties; and breaded fish fillets.

The acquisition includes six processing plants and an innovation center in the United States with locations in Alabama, Georgia, Kentucky, North Carolina, Pennsylvania, and Wisconsin. It also includes eight plants and three innovation centers in China, South Korea, Malaysia, Thailand, and Australia.

“Keystone is a leading global protein company and will be a great addition to Tyson Foods,” said Tom Hayes, president and CEO of Tyson Foods. “This acquisition will expand our international presence and value-added production capabilities and help us deliver more value to our foodservice customers. Keystone provides a significant foundation for international growth with its in-country operations, sales, and distribution network in high growth markets in the Asia Pacific region as well as exports to key markets in Europe, the Middle East, and Africa. We look forward to serving customers with these additional capabilities and to welcoming Keystone’s dedicated team members to the Tyson Foods family.”

Keystone, which employs approximately 11,000 people, generated annual revenue of $2.5 billion in the past 12 months ending June 30, 2018. During the same period, the company generated approximately 65% of its revenue from U.S.-based production and the remaining 35% from its Asia Pacific plants.

The transaction, which has been approved by Tyson Foods’ board of directors, is expected to close in mid-fiscal 2019. It is subject to customary closing conditions, including regulatory approvals.