Brazil JBS, World’s Top Beef Producer Wants to Be Number 1 Distributor Too

Brazilian cattle Brazilian company JBS SA, the world's largest beef producer, said it aims to also become the largest distributor of the meat by the end of next year and has been approached by companies seeking to be acquired.

"We are confident that we will be, at the end of next year, not only the major producer but the major distribution platform," of frozen products, Chief Executive Officer Joesley Mendonça Batista said in a seminar in New York.

Batista turned JBS into the world's top beef producer in 2007 after paying US$ 225 million for Greeley, Colorado-based Swift & Co. São Paulo-based JBS last year bought Smithfield Foods Inc.'s beef-processing and cattle-feeding operations for US$ 565 million. An agreement to buy National Beef ended after opposition from U.S. antitrust enforcers.

JBS last year stopped making acquisitions and focused on reducing debt, Batista said. Now, the company is ready to buy distribution assets and is analyzing offers from companies willing to be bought, he said.

"I see all of our competitors talking about de-leveraging at the same time that JBS is starting to think about new opportunities," Batista said during a webcast presentation at the BMO Capital Markets conference.

"Markets are getting better, the beef and protein markets, credit is coming back … I'm not suggesting we'll acquire someone tomorrow, but we're talking about how to take advantage of what we did, how to grow in this new scenario."

"Everybody has been calling, because when they look at our balance sheet, we are de-leveraged and we have cash," Batista said. "We talk to many people everyday."

JBS is not in formal negotiations with any companies "yet," Batista added. "Until today, we are just listening."

The meat producer is ready to take on debt again to finance its planned expansion. Batista said JBS sold US$ 700 million of five-year bonds in international markets in April. The yield of 13%, or 11.14 percentage points above U.S. Treasuries, was more than double the premium of its last offering in 2006.

"I'm thinking about leveraging again," Batista said. "For sure, if the financial market becomes better," he added, without specifying what kind of debt he would look for.

Batista declined to comment on JBS's performance. The company is scheduled to release its first-quarter results later this week, after market closes.

Analysts expect consolidation to increase in the sector. Several beef companies have filed for bankruptcy protection in recent months.

Mercopress

Tags:

You May Also Like

Former Minister Warns Brazilian Farmers: “Hold Your Horses”

Sow whatever you can using the best technology available and your own funds or ...

Brazilian President’s Popularity Inspires Movement to Extend His Time in Office

The high popularity of Brazilian president Luiz Inácio Lula da Silva – a record ...

Brazil’s Foreign Exchange Flow at US$ 2.9 Billion Deficit

The balance of dollar inflows and outflows from Brazil, known as the foreign exchange ...

Brazil-Venezuela Venture Will Refine 200,000 Oil Barrels a Day

Brazil's government-managed oil multinational Petrobras and government owned Petróleos de Venezuela (PDVSA) signed on ...

Brazil Wants to Use 1/4 of Its US$ 200 Billion Foreign Debt on Education

The idea was born at an international conference in Mexico in 2004. Brazil, Argentina, ...

São Paulo city

37% of All Brazilians Live in Six Cities

27.2% of the 5,507 municipalities in Brazil lost population between 1991 and 2000. On ...

While Weaning Out of Bolivia’s Gas Brazil Considers the Middle East

Brazilian oil giant Petrobras is studying the possibility of building units for the conversion ...

Brazil Wants to Include the Real as IMF’s Conversion Currency

Guido Mantega, Brazil’s Finance Minister,  suggested the International Monetary Fund (IMF) include China’s yuan ...

Brazil Asks for Arrest of Woman Who Murdered American She Met on the Internet

The Brazilian police have indicted a Brazilian woman for kidnapping and then killing an ...

Where Are Brazil’s Missing Kids? Each Year 6,000 Disappear Without a Trace

Each year around 40 thousand children and adolescents disappear in Brazil. According to data ...