The American food group ConAgra Foods Inc. is actively shopping its beef business, ranked third in the United States, to potential buyers, and has recently had talks with pork producer Smithfield Foods Inc., Reuters reports. The move may be part of a broader attempt by ConAgra to focus more on its retail products, such as Healthy Choice meals, Butterball turkeys, and Bumble Bee tuna, and to move away from commodity-oriented businesses that have pressured earnings. According to the source, Smithfield and ConAgra are not close to an agreement. "I know that Smithfield has been talking to ConAgra (about the beef business)," the source said. "As far as a deal, nothing is close." A sale to Smithfield, however, could help fulfil the American pork producer's desire to expand into beef and provide more pre-packaged offerings to grocers. Trumped late last year in its bid to buy the US number one beef producer IBP Inc. by poultry giant Tyson Foods Inc., Smithfield has made no secret of its desire for acquisitions, and in recent months has been buying up regional meatpacking companies. According to analysts, ConAgra's beef business, based in Greeley, Colorado, is believed to have between $5.5bn (Euro6.05bn) and $6.0bn (Euro6.6bn) in annual sales, or about one-fifth the company's total. The company remains hesitant about the effect of a sale, concerned that should it sell the beef business, its reduced holdings might become vulnerable to a takeover, the source said. The beef business competes with larger rivals IBP and Excel Corp., part of privately held Cargill Inc. Its sale could be a critical first step toward appeasing ConAgra's investors, who have been disappointed with the company's weak stock and earnings performance, analysts said. "ConAgra's dirt-to-dinner strategy has not delivered shareholder value in quite some time," said Prudential Securities analyst Jeffrey Kanter. "The fact that (the beef business) is potentially up for sale at least suggests that management is trying to correct a corporate structure that just hasn't worked in a while." In the past year, ConAgra has remained on the sidelines while its major food competitors, including Sara Lee Corp., Kraft Foods Inc., and Tyson Foods Inc., have made big moves to consolidate the industry. ConAgra's stock is down 12 per cent this year alone, closing at $22.95 (Euro25.25) a share in Friday New York Stock Exchange trading. In its fiscal year ended in May, the company's operating profit was essentially flat at $1.86bn (Euro2.05bn), held back in part by declines in its refrigerated foods and agricultural products businesses.