Brazilian New Food Giant’s Goal: Conquer the Planet

Sadia and Perdigão products at the supermarket Sadia and Perdigão, Brazil's two biggest food companies announced on Tuesday, May 19, plans to merge, creating an exporting powerhouse in a stock swap deal prompted by the global financial crisis. Executives from Perdigão SA and Sadia SA said they expect their new enterprise, to be called Brasil Foods SA, to become the world's top exporter of processed meat and chicken.

The merger creates a global food powerhouse with combined annual revenue of US$ 10.6 billion, 42 plants and a workforce of 119.000. The two were already Brazil's leading chicken and frozen food producers.

The deal is subject to regulatory approval in Brazil and Europe, a top market for Brazilian exports such as chicken. Analysts predict Brazil's government will quickly back it amid a broader push to boost large companies hurt by the economic downturn.

"We have a planet to conquer," Perdigão chief executive Nildemar Secches told reporters.

Perdigão will control 68% of the new enterprise and Sadia will have a 32% stake, Secches said. It will also look to raise as much as US$ 1.9 billion in a public offering of new shares by July, he added.

Sadia sought a partner after losing nearly US$ 400 million on bad currency bets as Brazil's Real dropped last year. Those losses surpassed the company's 2007 profits.

The new company will dominate many areas of Brazilian food sales, including frozen and processed meat products, margarine and pizza. Brazil's largest newspaper, Folha de S. Paulo, meanwhile predicted that its sales abroad will reach US$ 4.8 billion.

Luiz Furlan led Sadia for a decade before serving as trade and industry minister in Brazilian President Luiz Inácio Lula da Silva's administration. He resigned in 2007 and returned to Sadia last October as the financial crisis worsened.

He and Secches will share the chief executive post at the new company for two years.

Mercopress

Tags:

You May Also Like

Investors Cash in Profits Taking the Brazilian Market Down

Latin American stocks were mixed to lower, this Friday, January 27, with Brazilian and ...

Brazilian Embraer's Phenom 100

Kansas City Firm Orders 14 Phenom 100 Jets from Brazil’s Embraer

The U.S. fractional aircraft ownership company, Executive AirShare, of Kansas City, has signed a ...

A Warning from Molson Coors to Brazil: Make Money or Else

In a recent meeting of its board of directors, Canada-based Molson Coors Brewing Company ...

Stock Market Investors Grow But Investment Shrinks in Brazil

From July to August, the number of natural people investing in the São Paulo ...

Measures by Brazil and China Give the Dollar a Boost

Finally, on Tuesday, the dollar rose 1.26% in Brazil, closing at 1.687 sell, the ...

Indians from Southern Brazil Want to Sue Authorities for Racism

The Kaingang Indians from Brazil are mad at the way they are treated by ...

Brazil Lives Under a Blackout Threat and an Ultimatum by Organized Crime

Urban buses are back to the streets of Brazil’s major city São Paulo today, ...

Only 10% of Brazilians Belong to a Co-op. This Rate is 40% in Rich Countries.

More than 6.7 million associates, 7,500 organizations and a production that corresponds to 6% ...

Indians Get Land in Brazil and Governor Declares 7 Days of Mourning

After more than thirty years of resistance and organization by the Makuxi, Ingarikó, Taurepang, ...

Brazil & Co’s Bank of the South Will Have To Undo Neoliberalism’s Work

The launch of the Bank of the South is an ambitious and strategic gambit ...

WordPress database error: [Table './brazzil3_live/wp_wfHits' is marked as crashed and last (automatic?) repair failed]
SHOW FULL COLUMNS FROM `wp_wfHits`