SAO PAULO: Brazilian meatpacker Marfrig Global Foods SA has agreed to sell its US subsidiary, a key McDonald’s supplier, to Tyson Foods Inc for $2.5 billion, two people with knowledge of the matter said.
Marfrig shares rose as much as 8 per cent but reversed gains and were down 7.3 per cent at 6.38 reais as investors reassessed the price of the deal. Tyson rose 1.2 per cent to $61.71.
In a note to clients, Itaú BBA’s equities team said the news is “negative for the stock,” as the market hoped for a higher valuation of up to $3 billion, for chicken processor Keystone Foods. The bank kept its “underperform” rating on Marfrig.
Marfrig’s controlling shareholder Chairman Marcos Molina, who owns around 35 per cent of the meatpacker, agreed on Thursday to sell Keystone, a major chicken products supplier to McDonald’s Corp for $2.5 billion, according to the sources.
They asked for anonymity because they are not authorised to discuss the matter publicly. One of the sources said Marfrig may announce the deal as soon as Friday after the market closes. Some small details related to the deal, such as potential spin off of some small assets from Keystone, is delaying a final agreement. — Reuters
Oman Observer is now on the WhatsApp channel. Click here
