The Department of Justice's Antitrust Division has approved Smithfield Foods Inc.'s acquisition of Premium Standard Foods (PSF).

“The division found that the merged firm would continue to face significant competition in the sale of fresh and processed pork from its national competitors,” the department said in a news release. “Additionally, farmers who sell hogs or hog-raising services to the merged firm would have competitive alternatives that would deter the merged firm from lowering prices paid to the farmers.”

“This combination is a great strategic fit for Smithfield,” says C. Larry Pope, president and chief executive officer. “The acquisition of PSF fits well with our strong expertise in hog production and pork processing,” he adds.

Smithfield will purchase PSF for about $674 million in cash and stock and assume about $117 million of PSF's debt.

Smithfield, based in Smithfield, VA, is the nation's largest hog producer and processor with annual revenues exceeding $11 billion.

PSF, based in Kansas City, MO, is the second-largest hog producer and sixth-largest pork packer and processor, with annual revenues of about $900 million.