October 4, 2014

JBS suspends IPO for Brazilian food-processing operations

 

JBS SA's plan to raise a US$1.7 billion initial public offering of its pork, poultry and food-processing operations in Brazil has been put off, according to sources with direct knowledge of the decision.

It was the second time the São Paulo-based company has suspended the deal since June 2014.

The latest IPO will see the involvement of five banks, including Itaú BBA SA, Banco Bradesco BBI and Bank of America Merrill Lynch which have been mandated for the JBS Foods transaction, the source added.

With market volatility due to the political uncertainties of Brazil's presidential election this month, JBS and banks had been concerned that the development may affect sentiments ahead of potential investor meetings.

The current situation also means that IPOs in the country is expected to face their most challenging year in at least a decade.

JBS SA accounted for nearly 10% of JBS's US$40 billion revenue in 2013, with plans to list the unit in the São Paulo Stock Exchange's Novo Mercado chapter.