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Marfrig Acquires Part of National Beef, Becoming 2nd Largest Meat Company in The World

04/10/2018 - 10h34

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JOANA CUNHA
DANIELE BRANT
FROM SÃO PAULO

Marfrig announced on Monday (the 9th) that it had reached an agreement to buy a 51% stake in National Beef for US$ 969 million (R$ 3.3 billion).

With profits totalling R$ 43 billion (US$ 12.6 billion) and a slaughtering capacity of approximately 35 thousand, the Brazilian food processing company is now the second largest company of the sort in the world, only falling short of JBS.

The acquisition of National Beef will be financed through private bank Rabobank. The Brazilian National Development Bank (BNDES) - under the Workers' Party administrations of the last decade, helped Marfrig and other Brazilian food processing companies expand - will only have to sign off on the transaction.

Paulo Whitaker/Reuters
A worker arranges slaughtered cattle in the freezing room in the Marfrig Group slaughter house in Promissao (SP)
A worker arranges slaughtered cattle in the freezing room in the Marfrig Group slaughter house in Promissao (SP)

National Beef, whose headquarters is in Missouri, accounts for approximately 13% of the United States' slaughtering capacity and also has partnerships with producers - something that does not take place in Brazil.

The deal has been struck at a time when the Brazilian meat industry is trying to improve its image following a Federal Police investigation that began last year called "Operation Weak Meat".

Even though the operation did not target Marfrig, the company's CEO, Martín Secco, pointed out that the scandal that tarnished competitors BRF and JBS undermined the image of the Brazilian market as a whole.

National Beef exports meat to 40 different countries, including Japan and South Korea: markets that are currently closed to Brazilian beef exporters.

Translated by THOMAS MATHEWSON

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