What happened

Shares of Pilgrim's Pride (PPC 1.50%), one of the nation's biggest poultry processors, jumped today after JBS (JBSAY 0.66%), the world's biggest meat packaging company, proposed making a full acquisition of Pilgrim's Pride, buying the shares it didn't already own.

As a result, Pilgrim's Pride stock was up 20.9% as of 12:59 p.m. EDT.

A poultry worker walking through a chicken house.

Image source: Getty Images.

So what

In a filing this morning, Pilgrim's Pride said JBS proposed acquiring the remaining 19.5% of Pilgrim's Pride that it didn't own for $26.50 a share. Shares of the poultry processor were actually trading north of that this afternoon, above $27.40, showing that investors believe that buyout price could move even higher. Given the fact that JBS is already Pilgrim's Pride's majority owner, a deal seems likely to go through. JBS has been the majority owner of Pilgrim's Pride since 2009 when it acquired an 80.5% stake and brought the company out of bankruptcy.

In the filing, JBS Brazil said it expected "that a fully empowered special committee of independent and disinterested directors appointed by the Issuer's Board (the "Special Committee") will consider the Proposal and make a recommendation to the Issuer's Board."

Pilgrim's Pride management has not yet made a public comment on the matter.

Now what

The move would be the latest example of consolidation in the meatpacking industry, as operators like Tyson have sought to grow their global footprint to increase exposure and scale. Pilgrim's Pride shares have mostly traded sideways in recent years as the stock tends to move with volatile chicken prices, but it's not surprising that JBS would look to fully take over a company it already controls.

While it's not yet a done deal, an agreement seems likely. Look out for an announcement from Pilgrim's Pride in the coming days.