JBS, Bertin merger moving forward

by Bryan Salvage
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SÃO PAULO, BRAZIL — JBS S.A.’s board of directors met Dec. 7 with members of the independent committee of JBS and the board and members of the independent committee of Bertin S.A. The committees presented their recommendations on the economic terms of the proposed merger of the shares of Bertin S.A. into the company, in particular the determination of the exchange ratio for the transaction.

The JBS committee recommended the exchange ratio of the value of JBS in the combined company should amount from 53.5% to 70.2% and the value of Bertin in the combined company would amount from 46.5% to 29.8%. The Bertin committee recommended the exchange ratio be set within an interval of 31.23 to 34.61 shares issued by JBS for each existing share issued by Bertin.

As a result, the exchange ratio previously announced (approximately 40/60 among Bertin and JBS, respectively, which would correspond to an exchange ratio of 32.45518835 shares issued by JBS for each share issued by Bertin) is within the intervals recommended by the committees. The JBS board approved the report of its committee, according to a JBS news release.

The JBS board also determined the company should conclude the negotiation of the financial structure in favorable conditions — and following the conclusion, it should call a general shareholder meeting to approve the transaction.

JBS will continue to work on the other conditions precedent for the transaction, including the completion of due diligence and the $2.5 billion equity injection announced in the material facts dated Sept. 16, 2009 and Oct. 22, 2009.

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