Marfrig (MRFG3) raises R$7.5 billion by selling 16 factories and distribution center to Minerva (BEEF3) – Money Times

a marvrig (MRFG3) and the Minerva (beef3) reported on Monday (28) that they had reached a contract worth R$7.5 billion which includes a sale 16 factories and distribution centers.

The contract states that Marfrig will sell to Minerva the following: 11 units of cattle They are located in Brazil, and three of them are inactive; beef unit in Argentina; three livestock units in Uruguay; and a sheep unit in Chile. The transaction also includes the sale of Marfrig’s Brazil distribution center.

According to Marfrig, R$1.5 billion of the total deal amount will be paid upon signing of the contract, while the remaining R$6 billion will be delivered upon closing of the deal, with a bank guarantee.

According to the meatpacking company, given the revenue from current assets, of R$15.6 billion in 2022, the deal involves a 0.5 times multiple of the company’s value over revenue.

The completion of the deal is subject to the approval of the competition authorities. Marvrig stressed that, after selling the units, it will continue to operate in the beef sector in South America, with a “focus on the production of value-added products”.

At the end of the deal, Marfrig will have four plants in Brazil, four more in Argentina and two more in Uruguay in South America, as well as a feedlot in Uruguay, and seven distribution centers in Brazil (three) and in Chile (four). ).

Strategic opportunities

In concrete terms, Minerva mentioned that the acquisitions of factories, as well as the distribution unit, constitute strategic opportunities to complement the company’s operations.

According to Minerva, the assets involved are complementary to its industrial and distribution operations in Brazil, Uruguay, Argentina and Chile.

Upon completion of the transaction, Minerva will have a total cattle slaughter capacity of 42,439 head per day, broken down as follows:

In Brazil, it will rise to 22,336 heads per day (52.6% of total capacity), spread over 21 factories;

In Uruguay, it will increase to 4,550 heads per day (10.7% of total capacity), distributed over six plants; that it

In Argentina, it will rise to 5,978 heads per day (14.1% of total capacity), also distributed across six plants.

When added to the slaughter capacity of 8,025 head/day in Paraguay and 1,550 head/day in Colombia, Minerva Foods’ livestock slaughter capacity reaches 42,439 head/day, an increase of 43.7%, distributed across 40 plants in South America In addition, the company’s sheep production will increase to 25,716 heads per day, distributed over five factories located in Australia and Chile.