Pilgrim’s Pride has said that it expects to expand its business into new markets after it emerges from bankruptcy with Brazilian meat giant JBS as a majority owner.
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JBS will take a 64% stake in Pilgrim’s Pride in a deal with an enterprise value of US$2.8bn, the companies announced today (16 September).
According to Ray Atkinson, director of corporate communications at Pilgrim’s, the company’s financial position will be stronger in the wake of the transaction.
The company will also have “access to new markets”, providing opportunity for future growth, Atkinson said.
“We believe there will be tremendous synergies available through this alliance that will help us capitalise on our combined strengths and increase our sales channel penetration, especially in exports to specific markets,” he told just-food.
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By GlobalDataGoing forward, Atkinson said Pilgrim’s anticipates operating as a separate business unit from JBS’s US beef and pork businesses, but under the “JBS umbrella”.
“There will be some integration of our corporate functions into the JBS organisation. Over the next several months, Pilgrim’s Pride and JBS will develop an integration plan that lays out how that will take place,” he revealed.
Although existing Pilgrim’s investors will receive stock to the value of 36% of the company, Atkinson insisted that the deal represented good value for its shareholders.
“Our plan calls for repaying our creditors in full, in cash, while also preserving a lot of value for our existing shareholders. That is a very rare feat for bankrupt companies,” he said.
