Pilgrim's Pride shareholders to vote on sale

Court gives Pilgrim's Pride approval to get shareholder vote on sale

• On 2:43 pm EDT, Thursday October 22, 2009

PITTSBURG, Texas (AP) -- Chicken producer Pilgrim's Pride Corp. said Thursday a court has given approval for the company to ask shareholders to vote on its sale to Brazilian beef producer JBS SA.

Last month, JBS said it would buy a majority stake in Pilgrim's Pride for $800 million, in a transaction that would include paying off Pilgrim's Pride's creditors in full and distributing new shares to current holders. That's unusual for a company in bankruptcy protection because typically creditors aren't repaid. The entire deal is valued at $2.8 billion and it, along with another one announced last month, would make JBS the world's biggest meat maker.

The Pittsburg, Texas, company filed for Chapter 11 bankruptcy protection last year, as it was hobbled by debt and struggled to pay high feed costs.

The U.S. Bankruptcy Court in the Northern District of Texas has given approval to the company to start soliciting shareholder votes on the plan.

The company said copies of its reorganization plan will be mailed out to shareholders soon. Shareholders of record as of Thursday are eligible to vote. The deadline for ballots is Dec. 1, the company said. A court hearing to confirm the reorganization plan was set for Dec. 8.

Last week the Federal Trade Commission and Department of Justice cleared the way for the deal.

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