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May 24, 2021

Marfrig Global Foods takes minority stake in Brazilian meat peer BRF

Brazilian meat giant Marfrig Global Foods is to acquire a minority stake in local peer BRF.

By Dean Best

Publicly-listed Marfrig announced on Friday (21 May) it had acquired a 24.23% interest in BRF through the purchase of more than 196 million shares, explaining its aims through the transaction are to diversify “investments in a segment that has complementarities with its sector of activity”.

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Marfrig, headquartered in Sao Paulo, said it has no plan to elect members to the BRF board nor to “exert influence over the activities” of its Brazilian peer.

BRF, which mainly processes chicken and pork, acknowledged the deal via its own statement at the weekend, adding that Marfrig also has no plan to “promote changes in the control or in the administrative structure” of the company.

Marfrig and BRF had entered discussions in 2019 over a possible combination. However, that never materialised.

At the time, Marfrig said a merger would result in “the creation of a world leader in the protein market with wide geographical and product diversification” and it would reduce risk and “exploit operational and financial synergies due to the balance and complementarity of products, services and geographic diversification”.

Last year, Marfrig and another Brazil-based meat group, Minerva Foods, both denied they had opened merger talks.

Meanwhile, sources for news agency Reuters said the minority deal between Marfrig and BRF amounts to US$800m.

In 2020, Marfrig generated net revenues of BRL67.48bn (US$12.58bn). BRF posted sales of BRL39.5bn.

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Free Report
img

What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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