Let the pork wars begin.
One of Smithfield Foods Inc.'s largest shareholders, Starboard Value, said Tuesday that it plans to vote against the pork producer's proposed takeover by China's largest meat producer because it wants more time to seek other offers that would provide greater shareholder value.
The deal, which is expected to close by the end of the year, would be the largest takeover of a U.S. company by a Chinese firm, valued at about $7.1 billion including debt. It still requires approval of the federal Committee on Foreign Investment in the United States, which reviews overseas transactions for national-security implications. Smithfield's stock will no longer be publicly traded once the deal closes.
Smithfield has promoted the deal as opening the door to substantial increases in exports to China, but critics have voiced worry about persistent problems with food safety in China.
Starboard, a New York-based fund that holds a 5.7 percent stake in Smithfield, said in a letter to the company's shareholders on Tuesday that it had received "nonbinding written indications of interest" from other parties willing to pay more than the $34 per share cash deal proposed by Shuanghui.
While the counter-proposal was not completed, the hedge fund said it planned to vote against the Smithfield-Shuanghui merger later this month in order to buy more time to get such a bid finalized.
Virginia-based Smithfield, the world's largest pork producer, has scheduled a special shareholder meeting on Sept. 24 to vote on the proposed acquisition by Shuanghui.
Smithfield could not be immediately reached for comment about the shareholder letter on Tuesday morning.
Starboard has long insisted that Shuanghui's $34 per share bid "significantly undervalued" the Virginia-based pork processor—keeping the door open for other offers as a result.
CNBC, Reuters and The Associated Press contributed to this report.