Attorney General's News Release

October 6, 1999

Nixon to review proposed sale of nation's No. 2 hog producer to No. 1 producer; several Missouri facilities involved

Jefferson City, Mo. — Attorney General Jay Nixon today said his office would scrutinize the proposed purchase of the country's second largest hog producer, Murphy Family Farms, by the largest hog producer, Smithfield Foods Inc., for compliance with Missouri's antitrust laws and the state's corporate farming law. Murphy Family Farms owns several facilities in Barton and Vernon counties.

"At a time when Missouri's farmers have faced drought and record low prices for their products, we have to be concerned about the effects on the family farm of a merger between the nation's two largest hog producers," Nixon said. "If our review shows that this purchase would harm competition or violate the state law that strictly limits farming corporations in Missouri, we won't hesitate to take legal action to stop it."

Missouri law prohibits corporations from conducting farming activities in the state. The law provides an exception for swine production only in three north central counties. The Attorney General has power under the law to bring legal action in those cases where a violation is believed to have occurred.

Nixon said his staff also would examine the proposed purchase in light of state's antitrust and anticompetitive laws. The Attorney General has taken legal action in the past to stop mergers and acquisitions when he has believed those transactions would be harmful to competition.

Nixon also said he is concerned about the environmental track record Smithfield Foods has had in other states where it has operated swine facilities. In 1997 a U.S. District Court judge in Virginia imposed a $12.6 million penalty against Smithfield for polluting a river.

Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

All media inquiries should be directed to Press Secretary John Fougere.

E-mail      Phone: 573-751-8844         Fax: 573-751-5818