Pinnacle Foods Inc. opted to receive a $163 million breakup fee by terminating an agreement to be taken over by Hillshire Brands Co., clearing the way for its would-be acquirer to be bought out by Tyson Foods Inc.

Proceeds from the payment will be used to reduce debt, which will drop interest expense for the year to less than an original forecast of $100 million, Parsippany, New Jersey-based Pinnacle said in a statement yesterday. The company repeated its guidance for per-share profit of $1.70 to $1.75 this year.

The termination of the Pinnacle merger agreement allows Tyson to complete its $7.7 billion takeover of Hillshire. As a condition of that deal, Tyson had demanded that Hillshire scrap its accord withPinnacle. Hillshire withdrew its support for the Pinnacle merger on June 16, and yesterday’s announcement by Pinnacle means the deal is officially dead.

Pinnacle was little changed in late trading yesterday after closing down less than 1 percent to $32.90 in New York. The shares have gained 20 percent this year.

In a separate statement yesterday, Hillshire confirmed that Pinnacle had terminated its agreement and said it would “promptly review” Tyson’s offer.

Hillshire was known as Sara Lee Corp. before spinning off its tea and coffee segment and renaming itself Hillshire Brands in June 2012. It has since focused on improving lunchmeat quality, creating new varieties of hot dogs and winning over more customers with lower-calorie breakfast sandwiches.

The $4.3 billion bid for Pinnacle, which produces brands including Vlasic pickles and Wish-Bone salad dressings, had frustrated some Hillshire shareholders. Ricky Sandler, the chief executive officer of activist investor and Hillshire shareholder Eminence Capital LLC, criticized the Pinnacle deal for being too expensive and said his firm would vote against it.

About two weeks after Chicago-based Hillshire offered to buy Pinnacle, JBS SA’s Pilgrim’s Pride Corp. made an unsolicited $5.6 billion bid for Hillshire. That kicked off a bidding war, which Tyson, based in Springdale, Arkansas, won with a $7.7 billion offer on June 9.

Hillshire said a week later that its board supported that proposal and withdrew its support for its plan to take over Pinnacle.

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