BRAZIL: Minerva swaps stake for two BRF beef operations
The agreement is subject to approval by Brazil's anti-trust agency
Brazilian beef processor Minerva has agreed a deal to acquire two beef slaughterhouse operations from BRF in return for a stake in its company.
The slaughtering and deboning plants - Lowland and Great Mirassol D'Oeste - are both located in the State of Mato Grosso. The facilities have a capacity of 2,600 cows per day and had revenues of BRL1.2bn (US$533.7m) in 2012.
On completion of the transaction, BRF will receive 29m new shares of Minerva, holding a 16.8% stake.
The agreement is subject to approval by Brazil's anti-trust agency.
BRF last week issued third-quarter results that missed expectations, despite a jump in profits for the meat and dairy processor.
Earnings more than trebled. However, in a joint statement, chairman Abilio Diniz and CEO Claudio Galeazzi said the performance was below its expectations. Diniz, former head of Brazil's biggest retailer Grupo Pão de Açúcar, recently took over as BRF's chairman.
Through the agreement with Minerva, BRF said it will adjust its operating model on the beef market. The firm said it "will not leave the business" but will "de-verticalize" the chain, leaving the management of slaughtering activities in the hands of Minerva, at the same time as it "reinforces its presence in the food services and food from processed beef segments".
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