(Rewrites first sentence, adds company comments, details,
changes dateline to Chicago from New York).
CHICAGO, Dec 4 (Reuters) - U.S. chicken producer Gold Kist
Inc. (GKIS.O: Quote, Profile , Research) has agreed to a sweetened buyout bid by larger
rival Pilgrim's Pride Inc.(PPC.N: Quote, Profile , Research) , ending a takeover battle
that began four months ago.
News of the deal, announced in a joint statement, sent both
companies' shares higher in early trade on Monday.
Pilgrim Pride, the No. 2 U.S. chicken producer, said it
will buy Gold Kist in a sweetened offer of $21 per share, or
$1.1 billion. The tender will close on Dec. 27 and Pilgrim's
officials said the purchase could be completed by the end of
the year.
In August, Pilgrim's Pride launched a $1 billion hostile
takeover bid, or $20 a share, for Gold Kist after the two
failed to agree on a deal. Gold Kist rejected that offer and
said it would take measures to improve performance.
The two sides agreed to the sweetened offer of $21 per
share after Pilgrim's said last week that 67 percent of Gold
Kist's shares had been tendered under the initial $20 per share
offer, Richard Cogdill, Pilgrim's chief financial officer, told
Reuters in a telephone interview.
"I think that was the catalyst in bringing the sides
together to talk," said Cogdill.
Pilgrim's Pride will also assume $144 million of Gold Kist
debt.
The deal already has been approved by U.S. regulators.
"There are no regulatory issues in the way right now," said
Cogdill. "They (the Department of Justice) have already said
the transaction can go through."
In early trading Pilgrim's Pride shares were up nearly 10
percent at $27.81 per share at the New York Stock Exchange,
while Gold Kist shares were up nearly 4.3 percent at $20.82 per
share in Nasdaq trade.
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