Post-acquisition, JBS becomes world’s largest in poultry
By Bob Moser on 6/11/2013
JBS SA’s newest acquisition of Seara Brasil will make it the largest poultry processor in the world, in addition to already being the world’s top beef processor, the company said Tuesday. But reactions from local analysts and the Brazilian stock market were lukewarm at best, regarding the price JBS is paying to grow so quickly.
In addition to its North American poultry operations with Pilgrim’s Pride and year-old Brazilian poultry operations anchored by Doux Frangosul units, the new poultry and pork assets acquired with Seara Brasil will push JBS’s daily slaughter capacity to 12 million birds and 70,000 swine. The assets purchased from Marfrig will turn JBS into the second-largest Brazilian company in processed foods, after BRF.
The Seara Brasil subsidiary, one of two assets acquired Monday by JBS from Marfrig for $2.74 billion in debt assumption, includes 30 units and 45,000 employees. In all, they process around 2.6 million birds per day and produce 80,000 metric tons of processed food per month.
In acquiring Seara Brasil, JBS SA is now expected to achieve annual billing revenue of close to $46.53 billion, according to the company’s investor relations department. JBS posted net revenue in 2012 of $35.36 billion.
The full positive impact of Seara Brasil’s addition to JBS revenue should only fully appear in the company’s 2014 balance sheet, but it is expected to add $4.65 billion annually, when fully integrated.