Minerva Foods announced it has completed a transaction in which it purchased 13 slaughter and deboning plants from fellow-Brazil based protein producer Marfrig Global Foods.
According to a press release, those facilities are beef and lamb plants in Brazil, Chile and Argentina. Also included in the deal is a distribution center.
But the transfer of ownership of Marfrig facilities could continue. A deal in which Minerva would acquire three cattle slaughtering and deboning plants in Uruguay is still being reviewed by Uruguay’s competition authority.
If that is approved, Marfrig would collect about BRL7.5 billion for the facilities in the four South American countries.
Earlier Marfrig divestitures
The reason why this is pertinent to the poultry industry is because Marfrig, while not currently directly involved in the poultry sector, is the majority stakeholder in BRF, another Brazil-based company that is the third largest poultry producer in the world. BRF is also involved in pork production.
This appears to be Marfrig’s largest divestiture since it sold its Keystone Foods subsidiary to Tyson Foods in 2018. At the time, Marfrig said it sold the business partly to finance its acquisition of the majority stake in U.S.-based National Beef Packing Company.
That was the last time Marfrig, also the former owner of Moy Park, was directly involved in poultry production.
Marfrig and BRF
However, in 2021, Marfrig purchased 24.23% of BRF’s shares. Marfrig has steadily increased its stake in BRF, attaining the status of being the majority owner of the company in December 2023.
Also, Marfrig and BRF share the same chairman, Marcos Antonio Molina dos Santos. He has described Marfrig and BRF as “sister companies.” In April 2023, he indicated that “strategic movements” such as the two companies becoming was a possibility, but at the time, improving BRF’s financial performance was a higher priority.
Things do appear to be turning around for BRF, too. In August, the company released the financial results of the second quarter of fiscal year 2024, and BRF’s CEO, Miguel Gularte, called it BRF’s “best second quarter in its history.”
Incidentally, before becoming BRF’s CEO, Gularte was Marfrig’s CEO.
This is purely speculative, but with improved results for BRF, and a larger bank account for Marfrig thanks to the Minerva deal, a “strategic movement” involving Marfrig and BRF is a very good possibility.
And if the historical comments about the proceeds of the Keystone sale being used for other investments like National Beef, perhaps these proceeds might be invested in BRF. It definitely seems plausible.
