Brazil-based meat giant JBS has confirmed to just-food that it is “actively” looking to build the business through acquisitions in key markets including the US – but the company refused to be drawn on rumours linking it to ailing poultry processor Pilgrim’s Pride.
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Reports in Brazil and the US have claimed that JBS is interested in Pilgrim’s Pride, the US poultry group that entered Chapter 11 last year.
The Wall Street Journal has reported that a deal in the region of US$2bn to $2.5bn could be announced next week.
Analysts have reacted favourably to the prospect of a takeover, with one telling just-food the Pilgrim’s Pride would be an “attractive target” for the Brazilian group.
Pilgrim’s Pride has stayed silent on the speculation while yesterday (3 September) JBS issued an oblique statement in response to the mounting speculation.
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By GlobalDataThis afternoon, however, JBS investor relations director Jerry O’Callaghan said the beef and pork processor was interested in expanding in markets already key to the business – Brazil, Australia and the US.
“Expansion in our production capability and expansion in our protein business would be synergistic to our business,” O’Callaghan said. “To have scale is important.”
O’Callaghan noted that the “story” in the Wall Street Journal was “not alien” to JBS’s expansion strategy but he said he could not “confirm or deny” links to any company.
Last month, JBS revealed it had swung back into the black in the second quarter of the year after net losses of almost BRL323m in the first three months of 2009.
President Joesley Mendonça Batista then said that JBS was able to grow in a “sustainable manner”.
O’Callaghan said JBS had looked to “deleverage” its business to put the company in a position to expand once the global economy showed signs of recovery.
He added: “We are looking at opportunities because we think it is opportune to do so.”
