Cal-Maine Foods Ends Dual-Class Share Structure, No Longer a Controlled Company

Cal-Maine Foods, Inc. (NASDAQ: CALM) has completed the conversion of all its Class A shares into common stock, effectively eliminating its dual-class equity structure. The 4.8 million Class A shares, which carried ten votes per share, were converted on a one-for-one basis into common stock carrying one vote per share, reducing the company’s authorized capital accordingly.

This strategic move, executed under a prior agreement with DLNL, LLC and its members, marks the end of Cal-Maine’s “controlled company” status under Nasdaq rules. The change does not impact shareholder economic rights, as both share classes were previously entitled to the same dividends and liquidation preferences.

Following the conversion, the company filed a Certificate of Retirement and a Fourth Amended and Restated Certificate of Incorporation with the Delaware Secretary of State, formally removing references to Class A shares from its charter. No shareholder vote was required for this amendment, and no new voting bloc gained control as a result.

Cal-Maine emphasized that the conversion represents a dissipation of control rather than a traditional change in control, maintaining continuity in management and operations.

Cal-Maine Foods Posts Record Q3 Earnings, to Acquire Echo Lake Foods for $258M


RIDGELAND, Miss. — Cal-Maine Foods, Inc. (NASDAQ: CALM), the nation’s largest producer of fresh shell eggs, reported strong financial results for its third quarter of fiscal 2025 and announced a definitive agreement to acquire ready-to-eat egg product maker Echo Lake Foods, Inc.

Q3 Fiscal 2025 Highlights
Net sales surged to $1.4 billion, nearly doubling from $703.1 million in Q3 FY24.

Net income rose to $508.5 million, or $10.38 per diluted share, up from $3.00 a year earlier.

A record 331.4 million dozen eggs were sold, up 10.2% year-over-year, amid strong consumer demand and HPAI-related supply disruptions.

The average selling price per dozen rose to $4.06, compared with $2.25 in the prior-year quarter.

Feed costs per dozen declined by 9.6%, contributing to improved margins.

President and CEO Sherman Miller credited the quarter’s success to efficient operations during continued volatility caused by Highly Pathogenic Avian Influenza (HPAI). He emphasized that Cal-Maine’s scale, recent acquisitions, and focus on customer service helped mitigate supply constraints.

The company also approved a $500 million share repurchase program and declared a $3.46 per share dividend, in line with its one-third net income dividend policy.

Echo Lake Foods Acquisition
Cal-Maine signed a definitive agreement to acquire Wisconsin-based Echo Lake Foods for $258 million in cash. Echo Lake, known for its ready-to-eat egg products and breakfast foods like omelets, egg patties, and waffles, generated $240 million in revenue in 2024 with a five-year CAGR of 10%.

Key strategic benefits of the acquisition include:

Expansion into the value-added egg product market, offering higher stability and margin potential.

Synergies across procurement and operations.

Expected earnings accretion starting in fiscal 2026 and long-term ROE above the company’s cost of capital.

Echo Lake will continue operating as a standalone business, led by current CEO Kathy Brodhagen, who will join Cal-Maine as President of Echo Lake Foods.

Looking Ahead
Despite HPAI concerns—including over 32.9 million layer hens lost in early 2025—the USDA’s recent $1 billion support initiative is seen as a positive step. Cal-Maine emphasized continued investment in biosecurity, with over $70 million spent since 2015, and plans to add over 2 million hens and pullets through ongoing expansion.

Miller concluded, “While eggs remain our core business, this acquisition enhances our long-term growth, diversifies revenue streams, and provides greater supply chain resilience. We’re excited to welcome Echo Lake’s team into the Cal-Maine family.”

Cal-Maine Foods, Inc. announced that its board of directors approved an agreement with the family of its late founder, Fred R. Adams, Jr., regarding the potential conversion of Class A shares into common stock. The agreement follows the family's interest in diversifying their financial portfolios, which could result in the company losing its "controlled company" status under Nasdaq rules.

Under the agreement, if the family chooses to convert its Class A shares, it must convert all of them simultaneously, reducing its voting power from 53.2% to 12%. The agreement does not require the conversion or sale of shares but facilitates an orderly transition if it occurs.

Additionally, Cal-Maine Foods adopted a Third Amended and Restated Certificate of Incorporation and amended its bylaws to reflect governance changes, including board classification, restrictions on stockholder actions, and the introduction of preferred stock.

The board also approved a $500 million share repurchase program, allowing the company to buy back common stock in open market or private transactions. The repurchase program does not obligate the company to buy a specific amount and may be modified or discontinued at any time.

A press release was issued on February 25, 2025, detailing these changes.