Jan 21 (Reuters) – U.S. pork processor Smithfield Foods will buy century-old Nathan’s Famous in a $450 million deal that adds the most iconic U.S. hot dog name to its portfolio of brands, the company said Wednesday.
Nathan’s Famous started as a hot dog cart in 1916 by immigrant Nathan Handwerker with $300 borrowed from a pair of then-unknown entertainers, Jimmy Durante and Eddie Cantor, and originally sold the frankfurters for 5 cents. The iconic dogs became famous nationwide under the leadership of Handwerker’s son, Murray.
The offer price of $102 per share represents a nearly 10% premium to Nathan’s Famous’ stock price as of last close. Shares of the hot dog company were up about 9% at $100.94 in premarket trading. Smithfield already has an exclusive license to manufacture and sell Nathan’s Famous within the U.S., Canada and Sam’s Clubs in Mexico.
Nathan’s Coney Island locale is home to an annual hot dog-eating contest held on July 4, where winners are awarded a “mustard belt” for eating the most hot dogs. Last year’s men’s champion was Joey Chestnut, who devoured 70.5 hot dogs and buns in 10 minutes, according to the company’s website.
“The Nathan’s Famous acquisition is a meaningful step in the progression of Smithfield Foods, allowing us to own all of the top brands in our Packaged Meats portfolio,” Smithfield CEO Shane Smith said.
The deal is expected to close in the first half of this year, Smithfield said.
(Reporting by Angela Christy in Bengaluru; Editing by Anil D’Silva)
