On February 17, reports emerged that JBS S.A. has withdrawn its proposal for buying remaining outstanding shares of Pilgrim’s Pride Corp. (PPC).  This resulted in the downfall of shares of the company in the after-hours on Thursday.

After reaching a high of $28.10 the stock closed the regular trading session at $27.83. Thus, PPC lost a value of $0.23 or 0.82% during the session at a volume of 874.85K shares. Following the emergence of the report, the stock’s downfall escalated in the after-hours as it lost a further 16.82%. Therefore, PPC stock was trading at a value of $23.15 apiece in the after-hours on Thursday.

Founded in 1946, Pilgrim’s Pride Corp. is the second biggest chicken producer in the U.S. Currently, the company has a market capitalization of $6.48 billion with 243.68 million outstanding shares.

What is Happening?

Previously, in 2009 PPC filed for bankruptcy due to some company crisis. A few months after the company filed for bankruptcy, JBS stuck a deal to buy a majority stake in the company. Presently, the largest meat producer, JBS S.A. owns 80% of Pilgrim’s Pride.

Recently reports emerged that the meat giant was planning on buying the remaining of the company’s outstanding shares. The Colorado chicken company had rejected two offers from JBS already. On Thursday The Wall Street Journal among others reported that JBS S.A. has withdrawn its proposal for buying PPC’s remaining shares. The reports came soon after the company recently denied going forward with the transaction unless JBS significantly increased its purchase price. The now-canceled deal valued the company at around $7 billion. According to the reports, JBS failed to reach an agreement with the company’s special committee on the proposal.

Resultantly, the stock took a harsh hit in the after hours. It seems that investors were in favor of the transaction taking place rather than it being canceled.

PPC’s Financials

On February 09, the company reported its Q4 and fiscal 2021 financial results.

PPC’s net sales saw an increase of 22% YOY to $14.8 billion in fiscal 2021.

Moreover, the company had adjusted net income of $557.4 million with $2.28 per diluted share.

Furthermore, the adjusted EBITDA was $1.3 billion in fiscal 2021, marking an increase of 64% YOY.

Additionally, the GAAP consolidated operating income margin was 1.4% in fiscal 2021.