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Marfrig confirms bid for controlling stake in National Beef

Brazilian packer firm Marfrig has moved to acquire a controlling stake in National Beef. The São Paulo-based company said the deal will make it the world’s second-largest beef producer, behind rival Brazilian firm JBS.

Its calculation is that the National Beef acquisition will give it annual sales of around $13 billion and also allow it to break into two important Asian markets, Japan and South Korea.

Chief executive, Martín Secco, said at the time of the announcement: “With this transaction, we will have operations in the world’s two largest beef markets, will gain access to extremely sophisticated consumer countries and will be able to grow while maintaining rigorous financial discipline.”

Marfrig will pay almost $1 billion for its stake in National Beef. With a slaughter capacity of 12,000 head of cattle per day, National Beef has a share of around 13% of total US beef production at the moment. It runs two slaughterhouses in Dodge City and Liberal, Kansas.

National Beef also runs a hide-processing plant, National Beef Leathers, at St Joseph, Missouri. This facility processes hides from the group’s slaughterhouses to wet blue stage and offers wet blue in three full-substance weight categories to tanners around the world for retanning and finishing.

Holding company Leucadia has confirmed its intention to sell 51% of the equity in National Beef to Marfrig, but will retain 31%. The US Premium Beef, an association of more than 2,000 farmers and feedlot operators, will retain its 15% share. The remaining 3% is in the hands of small shareholders.

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