JBS moves to acquire Cargill’s pork business for $1.45 billion

Frazer  Jones
- Production - Jul 02, 2015

The meat industry in Brazil is booming, and it’s not just beef—from chicken to pork, the sector is massive and growing rapidly through many areas of South America. Brazil-based meat processing giant JBS is one of the largest processing brands in the world, and it’s on a roll in its quest to get even bigger and increase its global reach. The company’s most recent bid for growth comes this week, entering into an agreement to acquire the Wichita-based fellow processing giant Cargill’s pork business for $1.45 billion.

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This acquisition would give JBS control of Cargill’s two pork processing plants—one in Ottumwa, Iowa, and a second facility in Beardstown, Illinois—along with five feed mills and four hog farms across Arkansas, Oklahoma and Teas. In a joint press release from the two entities, Martin Dooley, president and COO of JBS USA Pork, discussed the acquisition as a strategic investment that will bolster the long term growth of JBS’s domestic and global pork business. Dooley also pointed to the action as a demonstration of JBS’s commitment to the livestock industry in the United States.

“This transaction will strengthen our position as a producer and supplier of all major animal proteins around the world, and provide increased opportunities for our producer partners and key customers,” said Dooley. “The strength and success of Cargill’s pork team and hog suppliers, as well as its industry leadership in areas such as animal welfare, exports, bacon production and innovation, were significant and compelling factors that led us to pursue this acquisition and enhance our ability to serve our diverse, global customer base.”

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Cargill executives echoed JBS’s sentiment that the Cargill pork business is a good fit to enhance growth and progress for JBS. “The strengths of the JBS and Cargill pork businesses are complementary,” said Todd Hall, Cargill senior vice president in the joint press release. “Together, they promise to offer enhanced service to customers and more opportunities for employees and hog producers while providing an important source of protein to consumers around the world.”

Hall went on to compliment JBS on its approach and express excitement about the potential that this acquisition will bring. “The professional and focused manner in which JBS approached Cargill demonstrated to us that they place a great deal of value on growing this part of their company to better compete in the marketplace and are willing to invest in its future,” he added. “JBS is acquiring a business with excellent people and fixed assets, and an established track record of success.”

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The acquisition is expected to be completed once it is completes a thorough review and approval process.

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