China is eating America’s lunch.
Iconic hot dog company Nathan’s Famous, best known for putting on the July hot dog eating contest, is being sold to Chinese-owned pork producer Smithfield Foods., for $450 million in cash. The companies announced the transaction last week, with Smithfield gobbling up Nathan’s shares for $102 each.
Some China watchers have expressed misgivings about a famous American brand being sold to a Chinese-owned company. U.S. competition with the Chinese Communist Party takes many forms, with food security being one of them.
“Food security is national security, and Chairman @RepMoolenaar has spoken out about China and the vulnerabilities in our domestic food supply. This deal should raise the mustard on foreign ownership of American food suppliers,” the House Select Committee on the Chinese Communist Party said in a statement shared on social media.
Representative John Moolenaar (R., Mich.), chairman of the China Committee, has emphasized the importance of food security to national-security. Food security was also a component of Nebraska’s state-level blueprint for taking on China across economic sectors, given the importance of agriculture to the Cornhusker state.
“Rather than allowing CCP-controlled Smithfield Foods to expand and acquire iconic American assets like Nathan’s, we should require Smithfield to be completely divested from Communist China’s control,” said Michael Lucci, CEO of State Armor, a watchdog group opposed to Chinese influence operations. Lucci cited reporting in the Daily Caller claiming several top executives at Smithfield’s parent company are Chinese Communist Party members with ties to the Chinese government.
“We should go in exactly the opposite direction and remove China’s control of our food supply chain.”
Smithfield had been in a licensing agreement with Nathan’s dating back to 2014. The agreement allowed Smithfield to manufacture, market, distribute, and sell Nathan’s products. Both companies celebrated the agreement because it will allow Smithfield to grow Nathan’s brand across food service and retail channels.
“Since entering into our licensing agreement in 2014, we have made significant investments to build and grow the Nathan’s Famous brand. With our manufacturing scale, marketing strength, product innovation capabilities, and retail and foodservice channel expertise, acquiring Nathan’s Famous will allow us to take the brand to new heights,” Smithfield president and CEO Shane Smith said in a statement.
The transaction will be funded with Smithfield’s cash on hand. It remains subject to antitrust clearance and a review by the Committee on Foreign Investment in the United States, an interagency panel tasked with reviewing foreign investments that potentially pose national security risks.