Marfrig Global Foods acquires control of National Beef Packing Company LLC. The $969 million acquisition makes Brazilian-based Marfrig the world’s second-largest beef processor, after JBS, with consolidated sales of $13 billion and gives the firm access to markets in Japan and South Korea. Leadership at National Beef, the fourth-largest beef processor in the U.S., will remain unchanged with Tim Klein continuing as president and CEO. “With the transaction we will have operations in the world’s two largest beef markets,” Marfrig CEO Martin Secco said in a press release. Since 2011, National Beef has been controlled by Leucadia National Corporation, with 79 percent of the producer’s interest. New York-based Leucadia will retain 31 percent interest upon the deal’s expected completion in the second quarter. Along with the National Beef purchase, Marfrig announced its intention to sell Pennsylvania-based Keystone Foods as part of deleveraging measures. National Beef, based in Kansas City, Missouri, has approximately 8,200 employees throughout its operations in Kansas, Pennsylvania, Georgia and Missouri. The company processes and markets fresh beef, beef- and pork-based ready-to-eat meals, beef by-products and leather in the domestic and international markets. In 2017, National Beef recorded sales of US$ 7.3 billion. Jess Peterson, Senior Policy Analyst, for the U.S. Cattlemen's Association, described the news as "concerning" for U.S. cattle producers. "Not only will this move increase consolidation of meat processors on a global level, but Brazil is simply a bad actor in the global marketplace. Our concerns lie with their intentions following the acquisition – is Marfrig trying to circumvent the current ban the U.S. has placed on Brazilian beef imports to take advantage of the U.S. cattle and consumer marketplace?”
And several U.S. Senators agreed. Four members of the Senate Agriculture Committee, including ranking Democrat Debbie Stabenow, want the Trump administration to fully analyze the national security implications of a Brazilian company’s acquisition of National Beef Packing Co.
“In light of recent acquisitions of U.S. food and agriculture companies such as Smithfield by Shuanghui in 2013 and the acquisition of Syngenta by ChemChina in 2016, it has become increasingly clear that growing foreign investment in U.S. agriculture requires a thorough review process to safeguard the American food system,” the senators wrote in a letter requesting a review of the merger by the Committee on Foreign Investment in the United States (CFIUS).
