Minerva purchase rival by 250 million R$ refrigerator

The fridge Minerva announced yesterday that it closed a contract for the acquisition of competitor capixaba Stresses for about 250 million R$. The value represents the payment of R$ 205 million related to the transfer of shares and more R$ 45 million for the working capital of the business on 31 December last year. The deal, which has already been approved by the Board of Directors of the Minerva, provides for the adjustment of the value of purchase in the event of variation of working capital. The purchase will be paid in installments: 50% of the total will be paid on the date of closing. The remainder will be settled in three annual installments. In 2015, Stresses was 942 million R$, being 33% of total sales on the exports, while earnings before interest, taxes, depreciation and amortization (Ebitda) was $43 million. According to the statement, the Stresses are one of the main producers of beef from Brazil, with units in Colatina (ES), Nanuque (MG) and Teixeira de Freitas (BA). The company still maintains a distribution center in Niterói (RJ). According to Minerva, the acquisition will help the company to have a presence in two Brazilian States which had not yet slaughter capacity – Espírito Santo and Bahia. The distribution center in Niteroi, according to the company, help in the strategy of broadening the distribution in the domestic market, with a focus on small and medium retail and food service (restaurants and snack bars). The transaction is still subject to approval by the Administrative Council of competition Defense (Cade). Upon completion, the Minerva will have total capacity of slaughter of about 19000 head per day in nine States in Brazil and Uruguay, Paraguay and Colombia, according to the document.
"The acquisition of Stresses is excellent strategic opportunity and represents another step in the consolidation of the sector in Brazil and in South America," Minerva said in a statement to the market, noting that some units have certification for export to China and United States.
Credit memo. According to S&P, the credit rating of the Minerva will not change with the purchase of the Notes. According to the Agency, the company remains with strong cash position (from 2.8 billion in R$ 30 June), reinforced by the recent issuance of bonus, which will provide resources for the company continue to lengthen the maturities of its debt and to reduce the costs of fundraising.