Chinese regulators approve deal to sell Heinz

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With the approval of Chinese regulators in hand, the sale of the H.J. Heinz Co. could close soon.

The Pittsburgh food company announced Friday that the Chinese Ministry of Commerce did not find any competitive issues of concern in the agreement to sell Heinz to a joint venture of 3G Capital and Berkshire Hathaway.

European Union and Russian officials still need to complete their reviews of the acquisition for antitrust issues, but Heinz now expects the $28 billion cash-and-debt sale to go through in early to mid-June.

The deal announced in February has moved relatively quickly through the various steps needed to get it done, including getting the approval of shareholders in a vote completed April 30. They will collect $72.50 per share, a 20 percent premium to the $60.48 closing share price the day before the announcement.

Because Heinz, which had $11.6 billion in annual revenues, sells goods around the world, officials in numerous countries have had to examine the agreement to see if the acquisition would create overlap or anti-competitive problems.

So far, that hasn't been a problem. Heinz has won antitrust clearance in the United States, Brazil, India, South Korea, Japan, Israel, Mexico, South Africa and Ukraine, in addition to some other needed regulatory approvals in New Zealand and Ireland.

The closing of the sale could come before Heinz would be expected to pay another round of dividends to shareholders. Last year, a quarterly dividend was paid July 10 to shareholders of record as of June 24.

"If the merger closes on this expected schedule, no more dividends (partial or otherwise) will be paid to shareholders," said Michael Mullen, senior vice president, corporate and government affairs, in response to a query.

The company will continue to be headquartered in Pittsburgh.

businessnews

Teresa F. Lindeman: tlindeman@post-gazette.com or at 412-263-2018.


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