...Proposed Pinnacle Acquisition: On May 14, 2014, Fitch Ratings downgraded The Hillshire Brands Company's (Hillshire) ratings to `BB/B' from `BBB/F2' and placed the ratings on Rating Watch Negative. The downgrade followed Hillshire's agreement to buy Pinnacle Foods, Inc. (Pinnacle) for $6.6 billion or 9.6x EBITDA, including $390 million of tax assets and $140 million of cost synergies, or more than 13.0x excluding these items. Pro forma total debt to EBITDA is in the mid-5.0x range, reflecting $4.8 billion of debt and $2.1 billion of equity financing. Buyout Offers: Fitch revised Hillshire's Rating Watch to Evolving from Negative on May 29, 2014, after unsolicited buyout offers from Pilgrim's Pride Corporation (Pilgrim's) and Tyson Foods, Inc. (Tyson). Tyson submitted the winning bid of $63 per share or $8.6 billion including net debt on June 8, 2014. The offer expires Dec. 12, 2014, and requires termination of the Hillshire/Pinnacle deal. Fitch views the 69% premium over Hillshire's stock...
