May 24, 2021

Brazilian beef producer Marfrig Global Foods SA announced last Friday it had bought 24% of BRF SA's outstanding shares for US$800 million, targeting to diversify its holdings rather than influence management, Reuters reported.

Marfrig said it would be a passive investor with no representation on BRF's board, and it took the stake to diversify its investments "in a segment which complements the sector where it does business."

The two companies' portfolios could be complementary if ever combined given Marfrig's focus on beef and BRF's on poultry and pork.

The latest move comes after failed merger talks between the two companies in July 2019.

Both companies compete with larger JBS SA, which has a diversified production base and sales of processed foods and three protein types. BRF has most of its plants in Brazil, while Marfrig sells beef in Brazil and North America, which accounts for most of its revenue driven by strong consumer demand and lower cattle prices there.