USA – Marfrig Global Foods, the second largest Brazilian food processing company has acquired 91.89% stake in Argentinean beef products producer, Quickfood for US$55 million.
Quickfood, which has three plants in Argentina, was under the control of BRF SA, one of the largest beef producers in the world.
The processing units have a daily processing capacity of 620 head of cattle and, in a month, process more than 6,000 tons of products such as beef patties, wieners, cold cuts and frozen vegetables.
Its brands include Paty, Good Mark and Barfy, Vienissima! the leading brand of wieners, and Green Life, the frozen vegetables brand.
The Buenos Aires Stock Exchange (PATY) listed food company recorded US$352 million in net sales in 2017.
“With this acquisition, we are reinforcing one of our strategic pillars: focus on growth in value-added products and brands,” said Eduardo Miron, global CEO of Marfrig.
“And we are doing this by acquiring a company renowned for operational excellence. We believe that this operation will create value for our stakeholders.”
Double BRF deal
Marfrig has also announced that it has entered a partnership with BRF, worth US$25.52 million that will see it take over the production of beef patties, meatballs and kibbeh at the plant in Varzea Grande, Mato Grosso.
The deal also dictates the transfer of equipment and infrastructure to Marfrig, taking over the operations at the unit, which has annual production capacity of 69,000 tons of beef patties.
As part of the agreement, Marfrig will supply these products to BRF for five years and grants it the opportunity to supply products, such as beef patties, to global food service companies in Brazil.
The agreement will also enable it adjust the estimated investment to a new beef patties plant in the country.
Both operations, Quickfood and Varzea Grande, will be managed by Miguel Gularte, CEO of Marfrig’s South-American operation, and will be financed with part of the company’s cash.
“We have a non-negotiable commitment to financial health,” said Miron.
“With the acquisition of these companies, we saw an opportunity to grow, maintaining and focusing on a simple structure, without losing sight of this commitment.”
The deal complements BRF’s operational restructuring plan which aims to accelerate the financial deleveraging process of the company.
The company is looking to raise US$1.27 billion to reduce debt through its divestment plan.
In June, BRF unveiled a restructuring plan to cut debt that includes the sale of operations in Europe, Argentina and Thailand.