For New Yorkers who visit the Coney Island boardwalk every summer, there is one spot they almost always stop at after hours of walking and riding amusement park rides under the hot sun.
The place is nothing fancy, just a simple yellow-and-red storefront with green-and-white striped awnings and a huge white-and-green sign, but the smell of sizzling hot dogs is enough to draw millions of families in, turning it into an unmissable tradition for many.
Founded in 1916, few could have predicted that what began as a small hot dog stand on Coney Island would grow into a global brand, renowned for its kosher beef hot dogs and for hosting the first-ever major hot dog-eating contest, now an annual Fourth of July spectacle. Today, the company sells its products in thousands of stores and operates hundreds of restaurants worldwide.
After more than a century of success and becoming a New York icon, the company is now taking a major step that could reshape its future for years to come.
Nathan’s Famous strikes acquisition deal with Smithfield Foods
Smithfield Foods has agreed to acquire Nathan’s Famous (NATH) for approximately $102 per outstanding share in cash, valuing the deal at about $450 million, according to a press release.
Smithfield has held an exclusive license to manufacture, distribute, market, and sell Nathan’s Famous products within the U.S, Canada, and Sam’s Club locations in Mexico since March 2014.
While that license was set to expire in March 2032, the closing of this acquisition would allow Smithfield to secure full ownership of the Nathan’s Famous brand and continue expanding across both retail and foodservice channels.
“Since entering into our licensing agreement in 2014, we have made significant investments to build and grow the Nathan’s Famous brand,” said Smithfield President and CEO Shane Smith in the press release. “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.”
Nathan’s Famous CEO Eric Gatoff agrees with those sentiments, calling Smithfield’s acquisition a “natural fit” for the brand’s next phase of growth.
“As a long-time partner, Smithfield has demonstrated an outstanding commitment to investing in and growing our brand while maintaining the utmost quality and customer service standards,” Gatoff added.
Smithfield Foods (SFD) is an American food company and the world’s largest pork producer and food-processing company, reporting over $14 billion in annual sales, according to its website.
Nathan’s Famous sells its entire business to Smithfield Foods.
Why the Nathan’s deal matters
Major producers like Smithfield seek to acquire long-established brands with strong consumer loyalty and pricing power, especially as rising costs and competition from lower-priced private-label products pressure margins across the food industry. For Smithfield, Nathan’s Famous offers all those assets.
“Companies make acquisitions because doing so spurs innovation, increases the odds of success, and reduces their chance of failure,” said Morgan & Westfield President Jacob Orosz in a study. “Large companies have high failure rates. They have too many resources. Losses are huge when an innovation at a large company fails. By acquiring other companies, large businesses reduce their long-term chances of failure.”
Many of Smithfield’s brands already compete in categories similar to Nathan’s Famous. By acquiring the entire brand, Smithfield consolidates its position in the sector while ensuring it captures a greater share of consumer spending regardless of shifting preferences and choices.
“The more brands a company owns, the more chance that consumers will choose to buy them,” said industry analysts at Brandstock.
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However, this deal is also mutually beneficial.
For Nathan’s Famous, the acquisition provides immediate access to Smithfield’s massive distribution network, enabling faster expansion, broader reach, and the potential to increase market share. It is also expected to help streamline supply chains and lower production costs.
“One of the most appealing aspects of M&A is the potential for cost synergies,” said industry experts at Sun Acquisitions. “These synergies may result from consolidating locations, streamlining supply chains, or leveraging more favorable terms with suppliers due to increased order volumes.”
Nathan’s Famous remains profitable nearly 110 years later
Despite operating for nearly 110 years, Nathan’s Famous has remained resilient through economic uncertainty thanks to its loyal customers and savvy business strategy, even as many food industry competitors struggle with rising costs and shifting consumer habits.
Nathan’s Famous ended fiscal year 2025 with 234 global restaurants, including 162 in the U.S. across 17 states, and operates 143 virtual kitchens worldwide, according to its SEC filing.
The company’s revenue increased 7% year over year to $148.2 million, while net income climbed 22.5% and EBITDA rose 11.4%.
By the second anniversary of the transaction’s closing, Smithfield expects to generate approximately $9 million in annual run-rate cost savings, driven by supply chain efficiencies and scale.
Nathan’s Famous board has already approved the merger agreement and agreed to recommend it to shareholders. The transaction is expected to close in the first half of 2026, pending approval from a majority of outstanding common stockholders.
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