J&F Investimentos denies hiring banks to sell Brazilian dairy Vigor - Just Food
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J&F Investimentos denies hiring banks to sell Brazilian dairy Vigor

14 Jun 2017

J&F Investimentos, the Brazilian holding company behind local meat giant JBS, has refuted a report claiming it has hired banks to advise on the possible sale of another asset, dairy company Vigor.

J&F Investimentos denies hiring banks to sell Brazilian dairy Vigor

J&F Investimentos, the Brazilian holding company behind local meat giant JBS, has refuted a report claiming it has hired banks to advise on the possible sale of another asset, dairy company Vigor.

Reuters yesterday (13 June) reported Banco Santander Brasil and Banco Bradesco were working with J&F on shopping Brazil-based Vigor to potential interested parties, including French giants Danone and Lactalis.

Approached for a reaction by just-food, J&F issued a short statement. “J&F informs that the company denies hiring any bank to sell its assets,” the company said.

Asked if J&F wanted to offload Vigor, a spokesperson referred just-food to the same statement.

Danone and Lactalis had not responded to requests for comment at the time of writing.

Switzerland-based dairy group Emmi, another company Reuters said had been approached, declined to comment on whether it had been contacted about Vigor. However, Emmi suggested it would not be in the running to buy Vigor should it formally come into the market in the weeks ahead.

A fourth dairy processor said by Reuters to have been contacted, Mexico-based Grupo Lala, could not be reached for immediate comment.

“Given the fact that we have just acquired the 40% stake in Laticínios Porto Alegre we do not see the need for an immediate further acquisition,” an Emmi spokesperson said.

Emmi announced the purchase of a stake in Brazilian dairy firm Laticínios Porto Alegre in April. Laticínios Porto Alegre is based in Ponte Nova in the state of Minas Gerais and, according to Emmi, is one of the five largest companies by milk collection in the region.

J&F is set to pay a BRL10.3bn fine to settle allegations over JBS’ involvement in two national corruption scandals. The fine, to be paid over 25 years as part of a deal with prosecutors, follows two police investigations – Carne Fraca and Bullish.

Carne Fraca probed a number of Brazil-based meat companies, including JBS, over alleged payments by meat processing firms to inspectors to overlook unsanitary practices.

The Bullish investigation had scrutinised suspected irregularities into the way state investment bank BNDES had approved support for JBS’ expansion.

In March, Brazilian business daily Valor Econômico claimed PepsiCo had made two bids for Vigor but no deal had been reached.

Vigor is one of Brazil’s largest dairy processors. It owns a 50% stake in another dairy company in Brazil, the co-operative Itambe.

In 2007, a majority stake in Vigor was sold to Brazilian meat processor Grupo Bertin. Two years later, Bertin sold a majority stake in itself to Brazilian meat giant JBS, another company controlled by J&F.

In 2012, JBS spun off Vigor, retaining a minority stake in the company.

In 2015, J&F announced plans to buy control of Vigor. Last year, Vigor was delisted.