Tuesday, April 10, 2018

Marfrig acquires control of beef processor in the U.S. for $ $969 mi

SAO PAULO (Reuters)-the Global Foods Marfrig announced on Monday an agreement for the acquisition of 51% of the National Beef Packing Company, American fourth-largest processor of beef from the United States, 969 million dollars.
The operation, according to Marfrig, aims to consolidate your strength in the beef segment and improve the indicators of leverage.
With the transaction, Marfrig will become "the second-largest beef processor in the world, with a global platform of production and a consolidated turnover of 43 billion reais", the brazilian company said in a statement.
The National Beef has slaughter capacity of 12,000 heads a day, is headquartered in Kansas City, in the State of Missouri, and has two processing units in Dodge City and Liberal, Kansas, which account for about 13% of total capacity of slaughter of the market nor you American. The company exports to 40 countries, including Japan and South Korea, currently closed markets to brazilian exports.
"With the transaction, we have operations in the two largest markets of beef in the world, there will be extremely sophisticated consuming countries and were able to grow while maintaining strict financial discipline," said the Chief Executive of Marfrig Martín Secco, said in a statement.
The results of the National Beef will be consolidated by Marfrig, reducing the level of leverage of the brazilian company to 3.35 times the earnings before interest, taxes, depreciation and amortization (Ebitda), compared to 4.55 times at the end of last year, said the Marfrig.
The Marfrig said that with the acquisition of National Beef and the planned sale of Keystone Food, expect to leverage your fall to 2.5 times by the end of 2018. JP Morgan is helping to Mafrig the sale of Keystone.
The acquisition of National Beef will be entirely financed by the Bank Rabobank. The company said it will take two bridge loans, for a total value of 1 billion dollars, which will be paid for with revenues from the sale of the Keystone.
The National Beef, which won last year 7.3 billion dollars, or 24.3 billion reais, is controlled by American investment holding company Leucadia National Corportation, from 2011, with 79%.
The Leucadia will transfer ownership to the Marfrig and will remain as a minority shareholder of the company, with a slice of 31% of the total capital. The US Premium Beef, American producers association, will be with 15% and other shareholders with the remaining 3%.
"Both Leucadia as other investors have committed to keeping their shares of National Beef for a minimum period of five years," said the Marfrig.
The top executives of the National Beef will remain at the company, which is under the management of Tim Klein, current CEO and President, said the Mafrig. The Board of Directors of the National Beef shall be composed of nine members, five of which will be indicated by Marfrig, two by Leucadia and two by other minority shareholders.
The Marfrig said he hopes to complete the acquisition of National Beef by the end of the first half of this year.
Reuters - 09/04/2018
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