Food and beverage company Sara Lee Corp has been in talks to sell itself to Brazilian meat producer JBS, but the pair are at odds over price and it is unclear if a deal can be reached, a source familiar with the situation said.
Talks have been on-and-off for a few months, the source told Reuters, adding that the pair have not yet managed to reach agreement on terms.
The situation remains fluid, the source said.
Based on Sara Lee's stock closing price of $17.26 on Friday, the company has a market capitalization of $11 billion. JBS has a market value of about $10.5 billion.
JBS is the majority owner of U.S. chicken producer Pilgrim's Pride Corp. Earlier this year, Brazilian publication Valor Economico reported that the company was looking for acquisitions to stay ahead of a spree of takeovers by rival Marfrig.
The future of Sara Lee, whose brands include Jimmy Dean sausages and Senseo coffee, has been in question for some months.
In November, the company sold its North American bakery business to Mexico's Grupo Bimbo for $925 million and analysts pointed out that the company's new focus, North American meats and European coffee, have little overlap.
As well as a possible sale, Sara Lee is also considering options such as separating its meats and drinks businesses, the source said. It is also examining keeping the status quo.
Sara Lee has been functioning with an interim chief executive since August when Brenda Barnes left after suffering a stroke.
Interim CEO Marcel Smits and Christopher J. (CJ) Fraleigh, head of Sara Lee's North American retail and food service business, are widely seen as candidates for the top job.
Private equity firm Apollo Global Management approached Sara Lee during the summer about a deal, a source told Reuters in October, after a report that Sara Lee had rebuffed an unsolicited offer that could have been worth $12 billion from KKR.
The Wall Street Journal reported on Friday that Sara Lee was considering selling itself to JBS. Bloomberg reported earlier on Sunday that talks between the pair have hit a snag and that Sara Lee rejected a takeover offer from JBS as being too low.
Sara Lee declined comment on Sunday. It was not immediately possible to reach a representative at JBS.
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