June 5, 2008

 

Brazil's newly merged meatpacker Uni Alimentos targets acquisitions

     

   

Brazilian slaughterhouse Uni Alimentos aims to make acquisitions to expand into poultry and pork segments, said Beto Esteves Uni Alimentos' export manager Wednesday (June 5, 2008).

 

Uni Alimentos, set to become Brazil's fourth largest meatpacker, is formed from the merger of Quatro Marcos Ltda. and Margen. The new company may be selling US$300 million worth of bonds and stocks to fund acquisitions. The Barueri, Brazil- based company also may sell shares in an initial public offering as early as the second half of next year.

 

"Uni Alimentos is assessing possible options such as an IPO or private investment to make acquisitions," Esteves told Dow Jones Newswires.

 

Brazilian mid-sized slaughterhouses Margen and Quatro Marcos merged on Monday to create a new company with the country's largest slaughterhouse capacity.

 

The merger is part of the recent consolidation trend in Brazil's meatpacking segment and should continue as small meatpackers try to fight off competition, said analyst Jose Amaral at beef market consultancy Scot Consultoria in Sao Paulo.

 

Uni Alimentos expects to reach a capacity to slaughter 18,500 head of cattle per day in the coming year, said Esteves.

 

The company will overtake meat company JBS's Brazilian capacity to slaughter 18,400 head of cattle and Marfrig's capacity of 13,300, local newspaper Valor Economico reported.

 

"Margen and Quatro Marcos needed to merge to gain size within the meatpacking segment which has been undergoing consolidation," said Esteves. The two companies' combined revenues were 2.7 billion Brazilian reals (US$1.6 billion) last year.

 

Uni Alimentos has 40 units of which 26 have slaughterhouse capabilities. The new company has around 18,000 employees.

 

Quatro Marcos holds 55 percent stake in the new company, while Margen holds the remaining 45 percent.

 

Brazil is the largest exporter of beef worldwide.