PRINTABLE VERSION   EMAIL TO A FRIEND   RSS FEEDS 13:37 UK, 8th Aug 2016, by Agrimoney.com
JBS takes first steps in ambitious restructure scheme

A massive restructure at JBS, the world's biggest meat packer, is now officially underway, as the bank asked for shareholder approval, and requested regulatory permission for a New York Listing.

The group, which owns the Swift, Pilgrim's Pride and Moy Park brands, is proceeding with a structural shakeup which will leave most of the company's assets in the hands of a New York listed entity, with only a minority stake in its Brazilian meat packing business remaining on the Brazilian exchange.

JBS first announced its intention to list in New York in May, on the basis that such a move would give it access to cheap credit.

US business takes ownership

On Monday JBS announced that it is soliciting shareholders consent for the restructuring.

On Friday JBS's Foods International (JBSFI), the US business, filed a request with the US Securities and Exchange Commission, for the distribution of its shares to JBS shareholders, on a pro rata basis.

Minority shareholders will be offered JBSFI shares, in exchange for their existing equity.

New York Listing

Under the new structure, JBSFI will have full ownership of all the company's businesses, including the Brazilian food business Sear Alimentos, apart from the Brazilian beef business.

The new business will be headquartered in Ireland, where JBS operates its Moy Park business, and is listed on the New York Stock Exchange

Through a holding company, JBSFI will have a majority stake of up to 75% of the Brazilian business, with the remainder of shares floating on the Brazilian exchange.

First step to restructuring

The Brazilian bank BTG Pactual said the listing was "a key first step to complete the global restructuring".

"JBS still expects the deal to be concluded by year-end, pending all the requisite approvals by local authorities and shareholders," BTG noted.

BTG was bullish on JBS prospects after the restructure.

"Assuming JBSFI can capture the advantages of being a US-listed company, which include enhanced corporate governance… and better access to global equity and debt markets, we continue seeing massive benefits," the banks said.

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