Marfrig Global Foods increases stake in US meatpacker National Beef

BRAZIL – Brazilian meat processor, Marfrig Global Foods has announced that it will increase its stake in US protein producer, National Beef Packing Company to 81.7% from 51%.

Marfrig will acquire the stake from Jefferies Financial Group Inc for US$860 million. Including dividends relative to this year, Jefferies will receive a total of US$970 million in the transaction, which is expected to close by the end of this year.

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Post transaction, USPB will be the second largest shareholder in National Beef with 15% while BPI will hold 2.4% and Tim Klein 0.8%. Tim Klein, President and Chief Executive Officer of National Beef will remain in place.

Marfrig acquired the controlling stake in National Beef in April 2018 for about US$969 million to enable the firm to expand its footprint in the US market.

By increasing its stake in National Beef, Marfrig will further cement the its foothold in the market. National Beef has a slaughtering capacity of 12,000 heads of cattle per day, with two slaughterhouses located in Dodge City and Liberal, Kansas.

Besides its beef operations, the Kansas-headquartered National Beef also processes and markets pork, beef by products and leather to foodservice, retail and wholesale customers. 

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Earlier this year, National Beef acquired Iowa Premium, a meat packer previously owned by Sysco in a transaction valued at US$150 million.

National Beef has also signed a long-term supply agreement with Sysco, an American distributor of food products to restaurants, healthcare and educational facilities, as well hospitality businesses.

In a move to expand the company’s geographical footprint and increase product diversification in South America, the US and the Middle East, Marfrig had in May this year, unveiled plans of merging with its Brazilian rival BRF SA.

However, the merger talks collapsed this summer. The combined company would have been the world’s fourth-largest meatpacker after JBS, Tyson and China’s WH Group Ltd.

Last year, Marfrig acquired 91.89% stake in Argentinean beef products producer, Quickfood for US$55 million.

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