Tyson Foods Closes IBP Acquisition

The long-awaited merger of Springdale’s Tyson Foods Inc. and Dakota Dunes, S.D.-based IBP Inc. became official on Sept. 28, but Tyson’s stock has slightly fallen off since the announcement.

Tyson’s stock reached $10.26 per share on Sept. 28, but had dipped to as low as $9.55 per share one week later. It closed at $9.75 Oct. 8.

Poultry giant Tyson purchased meatpacking power IBP for $4.6 billion, including $1.7 billion in IBP debt. IBP closed out its trading at $23.65 per share on Sept. 28.

The new Tyson Foods has already been organized in a “channel structure” to better serve customers. The company has two primary marketing groups or channels: a Foodservice and International Group and a Fresh Meats and Retail Group. Other aspects of the integration process remain underway and are expected to be completed by year’s end.

The acquisition makes Tyson the world’s leading protein provider. It will now claim 28 percent of the U.S. beef market, 23 percent of the chicken market and 18 percent of the pork market.

Tyson Foods’ annual revenue was less than half of IBP’s $16.9 billion in 2000, but projected revenues for 2002 are projected to be in excess of $25 billion, which would place the company within the top 70 of last year’s Fortune 500. The new Tyson has more than 120,000 team members in more than 130 production facilities across the United States.

IBP’s office complex in Dakota Dunes will remain the headquarters for IBP Fresh Meats, and will also be home to other operations and support services.