JBS announces major asset sale to cover debt
JBS bought Moy Park less than two years ago in 2015 for $1.5bn but has now put the business up for sale as part of a wider divestment programme to reduce net debt.
JBS, one of the world’s largest meat processors, is selling its US-based unit Five Rivers Cattle Feeding as well as a shareholding stake of 19.2% in dairy Brazilian dairy firm Vigor Alimentos SA.
Earlier this month, the business announced it would sell its assets in Argentina, Uruguay and Paraguay to fellow Brazilian meatpacker Minerva for $300m.
Corruption probe
JBS claims its divestment programme has been launched to reduce net debt and shrink leverage as the company – led by new chairman Tarek Farahat – tries to improve its financial structure.
Sale of the assets are subject to approval for the JBS board of directors and consent from Brazilian Development Bank subsidiary BNDESPar.
The massive JBS asset strip comes weeks after its holding company, J&F Investimentos, agreed to pay a record $3bn leniency fine amid a broader corruption probe. The business has always said JBS assets would not be sold to pay the huge corruption fine.
The fine comes after former JBS chairman Joesley Batista secretly recorded himself in conversation with Brazil president Michel Temer where the bribing of other politicians was allegedly discussed. This plunged JBS and Brazil into economic and political turmoil and president Temer now faces a Supreme Court investigation.
JBS was no longer the subject of investigation after J&F Investimentos paid the fine. Joesley Batista has since resigned.
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