NEW YORK -- Chinese meat processor Shuanghui International Holdings Ltd. has agreed to buy Smithfield Foods for approximately $4.72 billion.
Shareholders of Smithfield, the world's biggest pork producer, will receive $34 per share under terms of the deal announced Wednesday. That is a 31 percent premium to the Smithfield, Va., company's closing stock price of $25.97 on Tuesday.
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Both companies' boards have unanimously approved the transaction, which still needs approval from Smithfield's shareholders. The transaction may also be subject to review by the U.S.'s Committee on Foreign Investment.
The companies put the deal's total value at about $7.1 billion, including debt. Smithfield Foods Inc. -- whose brands include Armour, Farmland and its namesake -- has about 138.8 million outstanding shares, according to FactSet.
Smithfield's second-largest shareholder, Continental Grain Co., has been pushing Smithfield Foods Inc. to consider splitting itself up.
Smithfield's stock surged $7.23, or 27.8 percent, to $33.20 before the market open.