Bloomberg News

JBS Shareholders Agree to Swap 118 Million Shares for Vigor

June 21, 2012

JBS SA (JBSS3) shareholders agreed to swap 118 million shares for Vigor Alimentos SA (VIGR3) stock, less than the world’s biggest beef producer sought to exchange as it spins off the dairy unit.

Investors received one share of Vigor for each of JBS at an auction held at the BM&FBovespa SA (BVMF3) securities exchange in Sao Paulo, which disclosed the results by e-mail today. The swap, where JBS had planned to exchange as many as 149.7 million shares, valued Vigor at 1.19 billion reais ($579.5 million), or 7.96 reais per share.

JBS is spinning off Vigor as Brazil’s growing middle class increases consumption of yogurt and margarine. The company is looking to more than triple the unit’s sales to 5 billion reais by 2015 through acquisitions and new plants, JBS Chief Executive Officer Wesley Batista said on Dec. 19.

JBS said on May 18 that the Batista family’s FB Participacoes SA, which controls the meatpacker, would hold 44.6 percent of Vigor shares after the swap. The Brazilian development bank, which owns 31.4 percent of JBS, would have as much of Vigor if it chose to swap all the shares.

The BM&FBovespa didn’t disclose how much each JBS shareholder holds in Vigor after the auction.

JBS fell 4.7 percent to close at 6.05 reais in Sao Paulo after the auction results were announced. Brazil’s benchmark Bovespa index dropped 2.9 percent. Vigor will start trading tomorrow in Sao Paulo.

JBS declined to comment when contacted by Bloomberg.

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

To contact the editor responsible for this story: James Attwood at jattwood3@bloomberg.net


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