JBS to consider Frangosul purchase

by Meat&Poultry Staff
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SÃO PAULO, Brazil – JBS SA is considering its option to buy Groupe Doux’s local poultry production operation, Frangosul, according to news reports.

Wesley Batista, JBS chief executive officer, said during a conference call with analysts that the company will make a decision after an examination of the company’s debt profile. JBS announced May 4 that it is leasing the plants from France-based Groupe Doux. Under the lease agreement, JBS is not responsible for any of Frangosul’s liabilities, but that would change in the event of an outright purchase.

The lease agreement allows JBS to expand its poultry production by more than 15 percent, reaching a total capacity of 9 million birds per day, the company said in a news release.

“The assets will permit JBS to have a relevant operation in the chicken sector in Brazil allowing technology and knowledge transfer between its various production units,” the company said. “The US and Brazil are the two most relevant countries in the chicken sector. Together they represent 30 percent of global consumption, 36 percent of global production and almost 70 percent of global chicken exports.

“These indicators prove the relevance and competitiveness of these two countries, their global reach and their very dynamic domestic markets,” JBS concluded.

JBS said it would create a new business unit called JBS Chicken Brazil. James Cleary was named president and CEO of the new unit.

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