PORTFOLIO OPTIMIZATION
FOCUS ON VALUE-ADDED
AUGUST 2023
The Transaction
OVERVIEW
- On August [28th], 2023, the Board of Directors of Marfrig Global Foods, in line with its vision of repositioning the company to focus on value-added products, branded meat and processed products, approved the signing of a Purchase Agreement with Minerva Foods for the sale of 11 beef units located in Brazil (including 3 inactive), 1 beef unit in Argentina, 3 beef units in Uruguay and 1 lamb unit in Chile, and 1 Distribution Center in Brazil.
- The total value of the transaction is equivalent to R$ 7.5 billion, to be paid as below:
- R$ 1.5 billion on the signing
- R$ 6.0 billion at the closing of the Transaction (with bank guarantees)
- Considering the revenue of the assets sold of R$ 15.6 billion in 2022, the transaction has an implied multiple of 0.5x FV / Revenue.
- After the transaction, Marfrig will continue to operate in the beef segment in South America, focusing on the production of value-added products.
NEXT STEPS
- The Closing of the Transaction is subject to the approval of the anti-trust authorities.
2
Transaction rationale
CONSISTENCY IN STRATEGIC EXECUTION CAPITAL ALLOCATION IN VALUE-ADDED
Acquisition of
33% of BRF
Marfrig becomes the | ||
largest hamburger | ||
producer in the world | Acquisition of | |
National Beef: | hamburger company | |
Campo del Tesoro | ||
strategic shift to focus | Acquisition of Quickfood | |
(Argentina) | ||
on beef protein and | ||
high value-added | Acquisition of the Várzea | |
products in North | ||
Grande complex | ||
America | ||
Board of Directors | ||
Expansion capex on | reaffirms strategic | |
positioning | ||
the industrial | ||
complexes of | ||
Várzea Grande, | ||
Promissão, Tacuarembó | ||
Inauguration of | and San Jorge |
world's most
modern hamburger plant in Bataguassu
2 0 1 8 | 2 0 1 9 | 2 0 2 0 | 2 0 2 1 | 2 0 2 2 | 2 0 2 2 | 2 0 2 3 |
3
Transaction rationale
PORTFOLIO OPTIMIZATION
1 Strengthening and coherence with Marfrig's strategic plan, which started in 2018, to focus on high value-added products
2 Rationalization of operations in South America, with the maintenance of industrial complexes, with greater scale and relevance to the Company's strategy
3 Increase exposure in value-added products, with strong brands, which contribute with higher margins and resilience to the consolidated operation's result
4
The Transaction
POST TRANSACTION
STRUCTURE
Marfrig
South America
Industrial
Complexes
- 4 plants in Brazil
- 4 plants in Argentina
- 2 plants in Uruguay
Capacity:
Slaughter: 7k heads / day
Deboning: 44k pieces, equivalent to 11k heads / day Processed: 244k ton / year
Other
Units
- 1 feedlot in Uruguay
- 3 DCs in Brazil
- 4 DCs in Chile
5