Nathan’s Famous Sold: $450M Deal | NBC New York

Smithfield Foods Acquires Nathan’s Famous in $450 Million Deal

A century-old American institution, Nathan’s Famous, has been sold to Smithfield Foods for $450 million in an all-cash transaction announced Wednesday, marking a meaningful shift for the iconic hot dog brand.

did you know? — Nathan’s Famous began with a $300 loan in 1916, allowing Nathan handwerker to open a small hot dog stand in Coney Island, New York.

The acquisition sees Smithfield, already a long-time production and distribution partner for Nathan’s, taking full ownership of the company’s outstanding shares at $102 per share. Smithfield has held the rights to produce and sell Nathan’s products in the U.S. and Canada, and also at Sam’s Clubs in Mexico, since 2014.

The deal comes as Nathan’s, like many food companies, navigates a challenging economic landscape marked by inflation. A recent filing with the U.S. securities and Exchange Commission revealed a 27% increase in the sales costs of branded products compared to the previous year, with the average cost per pound of hot dogs rising by 20%.

From Coney Island Stand to National Franchise

The story of Nathan’s Famous began in 1916 when Nathan Handwerker opened a small hot dog stand in Coney Island, New York, with a $300 loan. The stand quickly gained popularity, and the handwerker family expanded the business over the years. In 1987,the family sold Nathan’s Famous to investors,but the franchise continued to grow,becoming a beloved american staple. The original restaurant remains on the same lot where Handwerker first began selling his 5-cent hot dogs.

Pro tip — Nathan’s hot dog buns are a key component of the brand’s success,and Smithfield’s production capabilities will ensure consistent supply.

More Than Just a Hot Dog: A Cultural Icon

Nathan’s Famous has cultivated a unique cultural presence in the United States,fueled by its history and the annual Nathan’s Hot Dog Eating Contest. Held every July 4th at the coney Island flagship location, the contest draws competitors from around the globe and an estimated crowd of 30,000 spectators, televised nationally on ESPN.

Joey Chestnut currently reigns as the champion, having consumed 70.5 hot dogs and buns in last year’s competition. Chestnut has dominated the event, winning 17 of the last 19 contests and setting a record of 76 hot dogs and buns in 2021. While the first officially recorded contest took place in 1972,Nathan’s claims informal eating contests began alongside the opening of the original stand in the early 20th century,with the 2025 event slated to be the 103rd. Smithfield has affirmed that the contest will continue under its ownership.

Reader question — Will Smithfield change Nathan’s Famous recipe or branding? The company has stated its commitment to maintaining the brand’s quality and heritage.

Smithfield’s Strategic Move and Financial Outlook

According to a company release, Smithfield anticipates annual savings of approximately $9 million within two years of finalizing the acquisition. “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,†stated Nathan’s CEO Eric Gatoff.

The deal was unanimously approved by Nathan’s board of directors, who collectively own or control nearly 30% of the company’s outstanding shares, and will be recommended to shareholders for approval. Smithfield, which also owns brands like Gwaltney bacon and Armour frozen meat, reported operating profits exceeding $1 billion on sales of $14.1 billion in 2024.

In fiscal 2025, Nathan’s reported a profit of $24 million on revenue nearing $150 million. The acquisition is expected to be completed in the first half of the current year.