Brazil’s Marfrig Global Foods announced early Monday it has reached an agreement to purchase 51% of National Beef Packing Co. for $969 million.
The acquisition would make Marfrig the world’s second-largest beef processor, with consolidated sales of US $13 billion. The acquisition would boost Marfrig’s total slaughter capacity to 8.3 million per year with the combined operations, and provide access to the Japanese and South Korean markets, which are currently closed to Brazilian beef.
“The acquisition of National Beef is a unique opportunity,” said Marfrig CEO Martín Secco. “With the transaction, we will have operations in the two largest beef markets in the world, we will reach extremely sophisticated consumer countries and we can grow by maintaining strict financial discipline.”
For U.S. Premium Beef, which owns 15% of National Beef Packing Co., it’s “business as usual,” according to Tracy Thomas, vice president of marketing.
Leucadia National Corporation will transfer National Beef’s control to Marfrig, but will remain as a minority shareholder with 31%. USPB will maintain its 15% stake and other shareholders control the remaining 3%.
Marfrig said National Beef will remain under the current management of CEO and Chairman Tim Klein.
“I am excited to welcome the Marfrig group as a partner in National Beef,” Klein said in a statement. “Their broad global food platform will further strengthen our efforts to build our brand in new and existing markets as the demand for high quality U.S. beef grows. This transaction will be transparent to our valued employees, suppliers and customers.”
Rich Handler, CEO of Leucadia, and Brian Friedman, President of Leucadia, said, “National Beef is an outstanding company and we are excited to continue our partnership with Tim Klein and the rest of the National Beef team. We are also pleased to welcome Marfrig as a partner in the company and believe the expanded partnership group will only enhance National Beef’s ability to serve its customers on a global basis.”
National Beef is the fourth largest beef packer in the U.S. with two processing plants in Dodge City and Liberal, Kan. The company formerly owned a processing plant in Brawley, Calif. that was closed in 2014 and later sold the next year. National Beef employs approximately 8,200 people across its beef processing, packaging and distribution chain.