Brazilian food group Marfrig has acquired Cargill-owned poultry business Seara Alimentos for US$706.2m.
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Marfrig yesterday (14 September) refused to be drawn on reports that it was in talks to buy the South American poultry business, however, the company today confirmed that the signed deal includes Seara’s “entire” animal protein business in Brazil.
This includes associated companies in Europe and Asia, including the brand in Brazil, 12 plants in the value-added processed and prepared poultry and pork products segment and one port terminal, with annual revenue of around $1.7bn.
Marfrig said it plans to integrate the businesses with other divisions within its group that have operations based on poultry, pork and prepared products.
The company said it stated its interest to Cargill at the same time it was doing a revision on Seara’s strategic plan.
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By GlobalDataAfter evaluating the Marfrig´s proposal and considering current changes in the industry dynamic of animal protein in Brazil, Cargill said it realized that the combination between Marfrig and Seara would make more sense “now and in the future”.
Cargill has reiterated to Marfrig that the sale does not change its commitment to continued growth in its business of beef, pork, chicken and eggs in various regions of the world and will continue to explore opportunities for new investments in the industry globally.
The financing of the acquisition may involve a common stock offering by Marfrig
through primary issuance of shares.
The transaction is expected to be concluded in the fourth quarter of 2009.
