JBS SA shares plummeted nearly 23%, on the news that an ambitious restructure has been scrapped, after opposition from the Brazilian government, wiping some $2.5bn of the stockmarket value of the world's largest meat packer.
JBS announced that it will not got ahead with its restructure, after opposition from BNDES Participacoes, the investment arm of the Brazilian state development bank, which holds a minority state in the company.
BNDES said that "it is against the proposed reorganisation... and is exercising its veto," JBS announced.
"As a result of this, the company is cancelling the steps towards the implementation of the reorganization."
The rejection deals a major blow to JBS's plans to continue its rapid expansion into overseas markets, and will make it harder for the company to access overseas capital.
The effect of the restructure would have been to effectively move JBS out of Brazil.
Control of the company's international operations would instead go to a new entity, listed in New York and headquartered in Ireland.
Only a minority stake in the company's domestic Brazilian business would have remained listed on the Brazilian exchange.
JBS's international portfolio makes it the world's largest meat processing company, with interest in beef, chicken, and pork around the world.
The move was intended the lay the groundwork for future expansion, including by improving access to capital, and by reducing the company's tax burden.
The restructure was first announced back in May, and it is reported that executive were confident the plan had the backing of BNDES.
But since then, there has been a change in leadership at development bank, after new acting president Michel Temer appointed the economist Maria Silvia Bastos as boss.
JBS shares were down 16.0% in afternoon deals in Brazil, at R$9.90 a share, after having reached as low as R$9.31.
This is not the first setback for the Batista brothers, Josesly and Wesley, who are JBS's chairman and chief executive respectively.
In September the brothers were bought in for questioning by police over alleged irregularities at the pension fund of another company, which is owned by the Batista family holding company.
JBS is not directly affected by the investigation, but Wesley Batista was briefly suspended as chief executive, although he has since returned.
By William Clarke