- JBS SA, soon to be JBS Foods International, unveiled plans for the reorganization and details of its business via registration statements the company filed with the Securities and Exchange Commission earlier this month.
- "Under the reorganization, JBS S.A. will contribute all of its assets except its Brazilian beef business to a new holding company (designated as New Holdco)," Meat + Poultry reported. "New Holdco will be a wholly-owned subsidiary of JBS International. JBS S.A., the retained Brazilian business, will become a consolidated subsidiary of JBS Foods International but will still trade separately on the Brazilian stock exchange."
- JBS expects to complete the transaction in the fourth quarter.
JBS has focused on strategically expanding its portfolio in a wide range of segments, such as fresh and frozen whole meats and meat parts, processed and value-added meat products, and prepared products, such as frozen pizza and lasagna. But the company has also carefully expanded its presence in key global markets, including the U.S., Australia, Brazil and Europe.
This depth of portfolio and market penetration makes JBS Foods International a significant competitor for a wide range of meat companies, ranging from Tyson Foods to Hormel. Those companies don't necessarily always compete directly with each other, showing the extent to which JBS Foods has become a dominant global meat entity. This reorganization could upset the current U.S. meat market if other manufacturers don't determine how best to deal with the competition in its newest form.
By following JBS's history of acquisitive growth over the past half a century, meat producers and manufacturers in general can draw clues as to how to continue to expand across categories and continents without becoming unwieldy and unprofitable. Those are valuable lessons for companies like ConAgra, which has recently worked to downsize its overreaching portfolio through divestments and a spinoff.