March 3, 2020 / 7:35 PM / 3 months ago

Brazil meatpacker Prima Foods files for $220 million IPO: sources

SAO PAULO (Reuters) - Brazilian meatpacker Prima Foods SA filed for an initial public offering, according to a securities filing on Tuesday, in a move that will list another company owned by the billionaire family Batista.

Jose Batista Junior, the older brother of Wesley Batista and Joesley Batista, controlling shareholders in meatpacker JBS SA (JBSS3.SA) and owner of Prima Foods, intends to partially sell his shares in the company, according to the filing.

The share offering is expected to reach roughly 1 billion reais ($222 million), two sources with knowledge of the matter said.

The company has slaughtering capacity of 2,600 head of cattle per day in the Brazilian states of Minas Gerais, Goias and Mato Grosso do Sul, the filing said.

Prima Foods posted revenues of 2 billion reais ($445.35 million) in 2019 and a net income of 241.2 million reais. Nearly 65% of its sales in 2019 were to countries outside Brazil, mainly China.

The company has hired the investment banking units of Banco BTG Pactual SA, Banco Bradesco BBI and Banco Santander Brasil to manage the offering.

Prima Foods will join Brazilian listed meatpackers, such as JBS SA (JBSS3.SA), Marfrig Global Foods SA (MRFG3.SA) and Minerva SA (BEEF3.SA).

Prima’s controlling shareholder JBJ Agropecuaria, owned by Jose Batista, is fighting an unfavorable decision by Brazil’s antitrust watchdog CADE in 2017. CADE decided that Batista could not acquire Prima, but Batista has questioned the decision in civil courts. The risk is disclosed in the offering prospectus.

Reporting by Carolina Mandl; Editing by Sandra Maler and Lisa Shumaker

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