US meatpacker Swift & Co in Brazilian hands 31 May 2007

The acquisition will create the world's largest meatpacking firm.


The transaction includes $225 million in cash and the assumption by J&F Participacoes of $1.2 billion in debt plus expenses.


Joesley Mendonca Batista, a partner in J&F Participacoes, said: "We are thrilled to acquire Swift & Company, and to be able to create a combined enterprise that will be the world's leading processor of fresh beef and pork products."


Access to Asia
Meanwhile, the merger provides the Brazilian company access to major Asian markets like Japan and South Korea, which have banned Brazilian product on fears of Foot-and-Mouth Disease (FMD), through Swift's US and Australian holdings.


"It is a major step for our group in establishing a global presence. More importantly, Swift will provide us with access to the Pacific region."


Reviewing strategy
This January, the board of directors for Swift & Co announced it was reviewing strategic and financial alternatives following a series of unsolicited inquiries from various entities.


Sam Rovit, Swift's president and CEO said: "Nothing is more important to me and my colleagues on the Swift management team than seeing Swift remain the strong, stable, customer-focused company we are today."


"Joining J&F to become the world's largest beef and pork processor, Swift should emerge even stronger, and that is good news for our partnership, customers, suppliers and employees."


Three pork plants
In the US, Swift has three pork plants, four beef plants, a lamb processing facility, and a further processing plant. In Australia, the company owns four beef plants and four cattle feedlots. Last year, the company had sales of about $9 billion.


J&F has a controlling interest in JBS, Latin America's largest beef processor. JBS is the maker of Brazil's Friboi meat brand. JBS has 21 facilities in Brazil and five plants in Argentina. The company had $1.9 billion in sales during fiscal 2006.


The transaction is subject to regulatory approval and should be completed by July.


Related news item:
• Brazilian bid for pork producer Swift & Co (11 May 2007)


Related websites:
• JBS
• Swift & Co


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