JBS has made a new proposal to take Pilgrim’s Pride private, nearly five years after its first attempt to buy out minority shareholders in the US chicken producer, in which the Brazilian meat giant owns an 82% stake.
Under the proposal, Pilgrim’s shareholders would receive 2.086 JBS shares for each Pilgrim’s share they own. The transaction would be worth about $1.2 billion in JBS stock based on the Brazilian company’s closing price of $13.66.
Pilgrim’s is listed on Nasdaq, while JBS shares trade on the New York Stock Exchange and are more liquid.
JBS said the stock-for-stock transaction would simplify its corporate structure while allowing Pilgrim’s minority shareholders to retain exposure to the chicken producer’s results.
“Pilgrim’s shareholders would receive JBS shares, which have a higher market capitalization and a broader institutional investor base,” the company said.
JBS has a market capitalization of about $14.6 billion in New York, compared with $6.8 billion for Pilgrim’s.
Over the past 10 trading days, an average 1.5 million Pilgrim’s shares changed hands each day, representing $42.7 million in daily trading volume, according to data from Koufin. JBS averaged 6.48 million shares, or $88.5 million, over the same period.
Investors welcomed the proposal, with Pilgrim’s shares rising more than 8% in after-hours trading, Bloomberg reported.
The transaction must be approved by an independent committee of Pilgrim’s directors, excluding representatives of the controlling shareholder, as well as by the company’s minority shareholders.
This story was translated from the original Portuguese with the assistance of artificial intelligence and reviewed by The AgriBiz editorial staff.
