JBS S.A. to Hold Most of Pilgrim's Pride Stock
Chicken added to the JBS U.S portfolio.
Compiled by staff
Published: Sep 17, 2009
JBS S.A. will soon hold a major portion of the new common stock of Pilgrim's Pride. Pilgrim's Pride Corporation says under a reorganization plan filed under Chapter 11 bankruptcy the company will sell 64% of its new common stock to JBS S.A. for $800 million in cash. The overall transaction represents an enterprise value of some $2.8 billion. If approved, the deal would make JBS USA a direct rival to Tyson Foods, currently the only major U.S. meat company to produce beef, pork and poultry.
Pilgrim said proceeds from the sale of stock will be used to fund distributions to creditors in cash or new notes. Meanwhile, existing shareholders will own 36% of the reorganized firm. With the Pilgrim's deal, JBS becomes majority owner of the nation's largest poultry producer.
Pilgrim's President and CEO Don Jackson believes his company is positioned to emerge from bankruptcy as a stronger, more efficient competitor.
"We have returned to profitability, the quality of our asset base has improved significantly and we are gaining additional business," Jackson said.
Pilgrim's expects to emerge from bankruptcy before the end of December, a year after it originally filed for Chapter 11 protection.
Permalink: Click here
|