Moy Park sold to US firm Pilgrim’s Pride for $1bn
Scandal-hit Brazilian brothers behind sellers JBS are shedding assets to pay for legal woes
A Moy Park processing plant: the company has been sold to a US firm
Pilgrim’s Pride, a US based chicken processor, said on Monday it had bought poultry supplier Moy Park from Brazil’s JBS in a deal valued at about $1 billion.
JBS is rushing to sell assets worth $1.8 billion to help its holding company, J&F Investimentos, pay a big fine after becoming embroiled in sweeping graft probes that ensnared Brazilian politicians and executives.
Moy Park supplies a quarter of the chicken consumed in western Europe, according to its website. It is one of Britain’s top 10 food companies, with 13 processing and manufacturing units in Northern Ireland, England, France, the Netherlands and Ireland.
JBS, the world’s largest meatpacker, had purchased a controlling stake in Pilgrim’s Pride in 2009 for $2.8 billion.
Global commodities trader Cargill was considering bidding for Pilgrim’s Pride, a Brazilian newspaper had reported in July, but JBS said the business was not for sale.
JBS had announced plans to sell Moy Park on June 20th.
The acquisition also gives Pilgrim’s growth opportunities in Europe, with access to an additional 300 million consumers and to local chicken production in the UK, company executives said on Monday .
The deal doesn’t need further approval by the Brazilian Court or antitrust authorities in the US, according to Pilgrim executives.
JBS shares rose 0.7 per cent to 8.25 reais ($2.68) in morning trading in New York time, while Pilgrim’s stocks fell 3.8 per cent to $27.99.
The scandal-hit Brazilian Batista brothers, Joesley and Wesley, whose family controls JBS, have been shedding assets to help pay for legal settlements after they confessed to graft and other crimes that allowed them to carry out a massive acquisition spree in Latin America, the US and elsewhere.
JBS and its holding company, J&F Investimentos , agreed last month to sell dairy producer Vigor Alimentos SA to Mexico’s Grupo Lala in a deal worth 5.73 billion reais ($1.86 billion).
J&F also agreed a week ago to sell pulpmaker Eldorado Brasil Celulose to Paper Excellence for 15 billion reais.
Joesley Batista turned himself in to police, J&F confirmed on Sunday, following a supreme court order.
A Brazilian judge had earlier issued an arrest warrant and temporarily suspended the immunity granted in a plea-bargain agreement signed by the businessman with Brazilian authorities in May.
Pilgrim’s said the enterprise value of the Moy Park deal is about $1.3 billion. JBS, which holds 79 per cent of Pilgrim’s Pride shares, according to date compiled by Bloomberg, bought the business in 2015 for about $1.5 billion, including debt.
Moy Park, which is based in Craigavon, Co Armagh, has more than 800 farmers across the UK and processes more than 5.7 million birds a week.