| SAO PAULO
SAO PAULO May 28 Brazilian federal prosecutors
on Sunday made a new offer to JBS SA's controlling
shareholder, J&F Investimentos, that it pay a 10.99 billion real
($3.37 billion) fine for its role in massive corruption
The new offer is down slightly from the previous proposal by
prosecutors that J&F pay 11.2 billion reais. The company
rejected that and counter-offered, saying it would pay 4 billion
reais. Prosecutors rejected that, as well as the company's next
offer that it would pay 8 billion reais.
Spokesmen for J&F did not immediately respond to requests
for comment on the latest offer from prosecutors.
Negotiations on the leniency deal fine follow bombshell
state's witness testimony from J&F's owners Joesley and Wesley
Batista that they spent 600 million reais to bribe nearly 1,900
politicians in recent years.
Joesley Batista is at the center of a corruption
investigation into President Michel Temer. Batista secretly
recorded a conversation with Temer in March in which the
president seemed to condone bribing a potential witness in the
The top court authorized a corruption investigation into
Temer based on that tape and testimony that the Batista brothers
and five other executives from their company gave regarding the
president and several other powerful politicians.
Investors are watching the plea negotiations. JBS shares
have slid more than 20 percent since mid-May in extremely
turbulent trading because of concern that blowback from the
scandal could limit its funding options.
The bribery scandal is one of several legal hazards facing
the group, which mushroomed from a regional Brazilian
slaughterhouse to the world's largest protein processor with the
help of some 8 billion reais in government support.
Brazilian rules for corporate leniency deals call for fines
of somewhere between 0.1 percent and 20 percent of annual sales.
Prosecutors said in their written statement on Sunday that
the proposed 10.99 billion real fine was equivalent to 6 percent
of J&F's group 2016 revenue.
Authorities also for the first time detailed who would
receive the fine from J&F. Brazil's BNDES state development
bank, along with the pension funds Funcef and Petros would each
receive 25 percent of any fine.
The remaining 25 percent would go to the federal government,
which would get 12.5 percent, along with the FGTS worker
severance fund and the Caixa Economic Federal bank, which would
each receive 6.25 percent.
($1 = 3.2598 reais)
(Reporting by Brad Brooks and Tatiana Bautzer in Sao Paulo, and
Lisandra Paraguassu in Brasilia)