Tyson Foods, Inc. has reached an agreement to acquire the Keystone Foods business from Marfrig Global Foods for $2.16 billion in cash. Based in West Chester, Pa., Keystone supplies chicken, beef, fish and pork to retail stores, convenience store channels and quick-service restaurant chains, including McDonald's. Keystone’s portfolio includes chicken nuggets, wings and tenders; beef patties; and breaded fish fillets.

The acquisition includes six processing plants and an innovation center in the United States with locations in Alabama, Georgia, Kentucky, North Carolina, Pennsylvania and Wisconsin. Keystone’s beef patty processing facility in Ohio is not included in the transaction.

Internationally, the transaction includes eight plants and three innovation centers in China, South Korea, Malaysia, Thailand and Australia.

Keystone Foods chicken nugget production“Keystone is a leading global protein company and will be a great addition to Tyson Foods,” said Tom Hayes, president and chief executive officer of Tyson Foods. “This acquisition will expand our international presence and value-added production capabilities and help us deliver more value to our food service customers. Keystone provides a significant foundation for international growth with its in-country operations, sales and distribution network in high growth markets in the Asia Pacific region as well as exports to key markets in Europe, the Middle East and Africa.”

Tyson Foods said it expects the acquisition to be accretive to GAAP earnings per share in the third year and accretive to adjusted e.p.s. in the first year. The company also expects to generate annual synergies of approximately $50 million by the third year of the acquisition, driven by operational efficiencies, procurement savings, distribution and supply network optimization and other opportunities.

Keystone Foods produces approximately 2 billion lbs of poultry, 300 million lbs of beef and 12 million lbs of pork each year. The company has approximately 11,000 employees and generated annual revenue of about $2.5 billion and adjusted EBITDA of $211 million in the 12 months ended June 30.

São Paulo, Brazil-based Marfrig acquired Keystone Foods in June 2010. In August 2017, Marfrig announced plans for an initial public offering of Keystone Foods, but it did not occur. In April, Marfrig agreed to acquire 51% of Kansas City-based National Beef Packing Co. The company paid $969 million for an equity interest in National Beef, which posted sales of $7.3 billion in 2017, making it the fourth-largest beef processor in the world.