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News 1545 views update:Mar 9, 2016

JBS seals major Brazilian poultry deal

Brazilian meat producing giant, and owner of US poultry producer Pilgrims Pride, JBS is to buy Seara Foods, the poultry unit of Marfrig Alimentos.

Brazil's JBS will acquire Marfrig Alimentos's local poultry and pork unit for $2.75 billion in assumed debt. The move should see JBS, which is the world's largest beef producer, claim the global top spot in poultry as well, chief executive officer Wesley Batista told a recent press conference in Sao Paulo, Brazil.

"This turns us into the No. 2 processed foods company in Brazil and is going to make us a global leader in poultry," Batista said. Despite the acquisition, JBS will still trail rival BRF SA in the local market for processed foods.

JBS's first entered the Brazilian poultry market in May 2012, when it leased assets owned by Frangosul, the local unit of French poultry company Doux. The Frangosul transaction, though, was primarily aimed at the export market. JBS also has poultry operations in the United States through its Pilgrim's Pride brand, which it bought in 2009 for $800 million.

The Seara acquisition, valued at 5.85 billion reais, will give JBS an estimated 10 billion reais of additional annual revenue and boost its poultry production capacity to 12 million animals a day, according to Batista. JBS had 75 billion reais in total revenue in 2012.

The sale of Seara Brasil does not include overseas assets such as the Keystone and Moy Park brands held by Seara Foods, the Marfrig unit that controls Seara Brasil.

Source: Reuters

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