Sanderson Farms is exploring the possibility of a sale as it is courted by a number of potential investors including agricultural investment firm Continental Grain.
Sanderson Farms is exploring a sale as chicken prices rise on increased demand, according to a report from the Wall Street Journal.
Shares of Sanderson Farms closed at $166.58 on Monday, up 6.96% on the talk of a potential deal, boosting its market cap to more than $3.72 billion. Any buyer would need to pay a premium to that price.
The Journal said Sanderson hired Centerview Partners for advice after attracting the interest of potential buyers, including agricultural investment firm Continental Grain.
A combination of strong demand and labor shortages has seen poultry prices rise rapidly. Chicken wing prices, for example, were $2.72 per pound on average last week, according to the U.S. Department of Agriculture, which is nearly 20 cents higher than the same week last year.
Sanderson is the third-largest food processor in the U.S. in a field dominated by Tyson Foods.