Another hog-farming operation affiliated with Smithfield Foods will become an independent entity, further reducing the world’s largest pork producer’s production footprint as it prepares for its first-in-a-decade United States stock listing.

Smithfield Foods announced on Dec. 20 it had signed an agreement with VisionAg LLC, an affiliate of HD3 Farms, to form a new company called VisionAg Hog Production LLC, which will supply hogs to Smithfield as an independent pork producer. HD3 Farms has been a contract partner for Smithfield for more than 20 years and has 250,000 wean-to-finish facilities on farms across eight North Carolina counties, according to a company news release.

Earlier in December, Foods announced it and North Carolina-based Murphy Family Ventures would reestablish a Murphy-owned farming business that, by the end of 2024, would take ownership of 150,000 sows owned by Smithfield and gain the capacity to produce approximately 3.2 million hogs annually for Smithfield’s pork operations.

VisionAg, under the Dec. 20 agreement, will acquire an additional 28,000 sows currently owned by Smithfield and is expected to have capacity to produce another 600,000 hogs annually for Smithfield, which will own a minority stake in the new VisionAg entity.

Smithfield will also retain a minority stake in Murphy, which for the past 24 years, like VisionAg, has operated as a contract partner. Smithfield acquired Murphy Farms Inc. in 2000 and merged its hog-farming operations with Brown’s of Carolina Inc. in 2001 to form Murphy Brown, which it rebranded as Smithfield Hog Production Division in 2015.

The two transactions will collectively reduce Smithfield’s hog production footprint by roughly 24% from 15.8 million hogs in 2023 to 12 million. Smithfield Vice President of Corporate Affairs Jim Monroe, following the Murphy announcement, said the production decrease since 2023 was on par with a roughly 20% reduction over the past two years in response to supply and demand.

Smithfield will supply feed, transportation and other hog production services to VisionAg upon the closing of the transaction, which Smithfield expects will occur in early 2025, according to its news release.

The two hog production agreements come amid plans to take Smithfield public for the first time in a decade of Chinese ownership. The Hong Kong-based parent company acquired Smithfield Foods in 2013 for nearly $5 billion, though Foods remains headquartered in its namesake town of Smithfield.

WH Group, in a July proposal to the Hong Kong Stock Exchange, proposed spinning off Smithfield’s United States and Mexico operations as a public listing dubbed “Smithfield U.S. and Mexico” that would be traded on either the New York Stock Exchange or Nasdaq in the U.S. According to a WH Group news release, 99% of shareholders voted to approve the spinoff in a Dec. 6 vote.

According to a Nov. 18 letter from WH Group Chairman Wan Long to shareholders soliciting their support ahead of the Dec. 6 vote, WH Group would offer up to 20% of its Smithfield shares, valued collectively at $5.38 billion as of September, pending the U.S. Security Exchange Commission’s approval, which Smithfield solicited on Oct. 4.

Monroe deferred to the company’s news release and declined to comment on the plans to take Foods public.