Bloomberg News

JBS to Spin Off Vigor Dairy Unit, List Shares in Sao Paulo

February 10, 2012

Feb. 9 (Bloomberg) -- JBS SA, the world’s largest beef producer, will spin off its Vigor Alimentos SA dairy unit and list shares in Sao Paulo as it seeks to gain market share from rivals Nestle SA and BRF - Brasil Foods SA.

Shareholders will be able to swap JBS stock for shares in Vigor, Brazil’s fourth-largest maker of yogurt, cheese and margarine, the Sao Paulo-based company said in a regulatory filing today, without saying how many shares will be exchanged.

JBS will spin off Vigor as it seeks to more than triple the unit’s sales to 5 billion reais ($2.9 billion) by 2015 from last year’s 1.5 billion reais through acquisitions and new plants, JBS Chief Executive Officer Wesley Batista said Dec. 19.

Vigor, which represented about 2 percent of JBS’s 2010 sales of 55.1 billion reais, owns seven plants. The maker of Vigor yogurt and margarine and Faixa Azul cheese has a 6.9 percent market share of dairy products in Brazil, according to a company presentation.

Gilberto Xando, who worked for about 20 years as a marketing and international director at Sadia SA, will remain chief executive officer of the divested company, Vigor Alimentos. Batista will become chairman. Vigor in December named Anne Karine Napoli, a former executive at Unilever, as its marketing director.

Novo Mercado Trading

Vigor plans to list shares on the Novo Mercado trading segment in Sao Paulo, which means it must have at least 25 percent of its stock available for the public.

JBS will seek consent from holders of its 2014 and 2016 bonds issued by JBS USA LLC, JBS USA Finance Inc., JBS SA, JBS Finance Ltd. and Bertin SA. The Vigor spinoff requires consent from the bondholders, JBS said.

JBS is controlled by a group of six Batista brothers, which directly and indirectly owns 45.7 percent of the company. Brazil’s development bank, known as BNDES, holds 30.4 percent.

--Editors: Robin Saponar, Dale Crofts

To contact the reporter on this story: Lucia Kassai in Sao Paulo at lkassai@bloomberg.net

To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net


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