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Shares of the world’s largest meat processor increased 12.8% in Brazil at the announcement of its restructuring strategy, which has been approved by BNDS, the Group’s biggest shareholder.
As reported by ILM, the Brazilian meatpacker announced JBS Foods International will take control of all the company's businesses except for the Brazilian beef industry, which will remain under the direct control of parent company JBS SA. The Group said it will also launch shares in New York for its U.S subsidiary, and the public offering is expected to be completed in the first six months of 2017.
Unlike its initial plans to establish the headquarters in Ireland, the move to a New York listed business should provide a better access to refinancing, an important factor for the heavily indebted company.
JBS shares were up 12.8% at R$10.47 (US$3.09) on the initial news. According to reports, shareholders in JBS SA will be allowed to hold onto their original shares, rather than being forced to migrate their holdings over to the international business.
Compared to the previous restructuring, the new plan is seen as "a less complicated initial public offering with no changes in the holding company", said Brazilian broker Itau, adding that the BNDES' approval was certainly, “based on the fact that JBS's holding company and headquarters will remain in Brazil”. However, the success of the offering will be dependent on demand for the New York shares, according to the broker.