Tyson Foods on Thursday (Aug. 28) completed the $8.5 billion acquisition of Hillshire Brands, the largest deal ever in the meat industry.
As expected, Hillshire CEO Sean Connolly will not remain with the new company but will consult during the integration process. This was one of several key management shifts announced as the two companies begin to blend their operations.
“As of today, Tyson Foods and Hillshire Brands are officially together in one great company,” Tyson Foods CEO Donnie Smith said in a statement. “Part of our strategic growth plan has been to shift toward higher-margin prepared and branded foods. This transaction gives us a portfolio of complementary, proven brands as a new springboard and accomplishes in a short time what would have taken us years to build on our own.”
The integration of the two companies is expected to generate synergy savings of $225 million in fiscal 2015 and more than $500 million by fiscal 2017.
Teams of people from Tyson and Hillshire have worked on integration plans since July to help make sure the combined company gets off to a good start, Tyson noted in the release.
“During this process, I’ve had a chance get to know many people on the Hillshire Brands team and the great work they’re doing, and I’m more convinced than ever that the future of our combined companies is bright,” Smith said. “As excited as I am about our new brands, I’m equally excited about the combined talent of the two companies.”
A new leadership team has been selected and includes a mix of existing senior leaders from Tyson Foods and Hillshire Brands.
Andy Callahan, former president of Hillshire’s retail business, will manage all retail consumer brands, including the legacy Hillshire consumer brands (such as Jimmy Dean, Ball Park, Hillshire Farm and Sara Lee), Tyson consumer brands (such as Tyson frozen, value-added poultry and Wright® Brand bacon) and Hillshire’s Gourmet Food Group.
Sally Grimes, former chief innovation officer and president of Hillshire’s Gourmet Food Group, will lead Tyson’s innovation (including research and development), sales and global brand strategy teams to support all products sold through retail channels and to maximize global growth of our consumer brands.
Donnie King, former president-Prepared Foods, Customer and Consumer Solutions for Tyson Foods, will oversee Tyson’s legacy poultry, fresh meats and non-branded prepared foods businesses as well as the combined Tyson Foods and Hillshire foodservice businesses.
Those reporting to King will include Steve Stouffer who will lead fresh meats; Noel White who will lead poultry; Wes Morris who will lead prepared foods operations; and Tom Hayes, the chief supply chain officer for Hillshire Brands, who will lead the combined Tyson and Hillshire foodservice businesses.
Those continuing to report to Donnie Smith include:
• David Van Bebber, who leads the Tyson legal team;
• Sara Lilygren, who leads corporate affairs;
• Dennis Leatherby, who continues as the company’s chief financial officer;
• Hal Carper, who heads strategy and new ventures;
• Mike Roetzel, who oversees operations services; and
• Russell Tooley, who heads the company’s business process and continuous improvement practice.
Ken Kimbro, who has led Tyson Foods’ human resources functions since 2001, will transition into retirement and be replaced by Mary Oleksiuk, former chief human resources officer for Hillshire Brands.
Malik Sadiq, senior vice president-Asia Pacific, will oversee Tyson International on an interim basis. He takes the place of James Young who will be transitioning to our Cobb-Vantress breeding stock subsidiary in the coming months.
“This is an awesome team and they’re prepared to make this integration process smooth and efficient while we continue to exceed the expectations of our customers and consumers,” Smith said.
Shares of Hillshire Brands will be delisted as a result of this merger and cease trading at the close of business Aug. 28.
Shares of Tyson Foods rose 33 cents on Thursday to close at $38.04. For the past 52 weeks Tyson shares have traded between $27.33 and $44.24.