Sanderson Farms sale said unlikely to get approved without changes - report
Sanderson Farms (NASDAQ:SAFM) sale to Continental Grain and Cargill is unlikely to be approved by U.S. antitrust regulators unless some changes are made to the transaction, CNBC's David Faber said. Sanderson Farms dipped 1%.
The parties are said to be interested in changing the deal, potentially bringing in private equity to try to get Justice Dept approval for it, Faber said.
The report comes as Sen. Elizabeth Warren (D-MA) and others last month renewed a call for DOJ to scrutinize Sanderson Farms planned sale to Continental Grain and Cargill because it raised "significant" antitrust concerns.
Warren in November urged the DOJ to investigate how alleged "anticompetitive practices" in the poultry industry are causing price increases. Warren asked the DOJ to "consider the extensive history of price fixing" in the poultry industry in evaluating the announced sale of Sanderson Farms (SAFM) to Continental Grain and Cargill.
Recall in December Continental Grain and Cargill's planned acquisition of Sanderson Farms (SAFM) received a "second request" from the Dept. of Justice in regards to its antitrust review of the deal. From the start, when the deal was announced in August, it appeared that the deal was expected to see scrutiny from regulators.
Earlier, Justice Dept. said to probe chicken companies over wage information.