JBS Foods Seeks Authorization to Break Brazil IPO Drought

JBS SA, the world’s largest beef producer, is seeking regulatory approval to sell shares of its poultry and processed food unit in what would be Brazil’s first initial public offering this year.

Voting shares of JBS Foods SA will be listed in Brazil’s Novo Mercado subject to regulatory approval and market conditions, the Sao Paulo-based company said in a filing today. No further details were given.

The IPO would help unlock value by separating the unit from the parent company. JBS Foods, the second-largest producer and exporter of poultry and pork in Brazil, was formed after JBS agreed to buy Seara food processing assets from Marfrig Global Foods SA for 5.85 billion reais in June 2013.

JBS hired units of JPMorgan Chase & Co. and Banco Bradesco SA for a 3 billion-real ($1.3 billion) IPO of the unit, two people with direct knowledge of the matter said in April.

The company also hired Banco Itau BBA SA, Banco Santander SA, Grupo BTG Pactual and Banco do Brasil SA to underwrite the share offering of JBS Foods, the people said, asking not to be identified because negotiations are confidential. The timing of the sale will depend on market conditions, they said. JBS, Banco do Brasil, Santander, JPMorgan, Itau BBA, Bradesco BBI SA and BTG declined to comment at the time.

JBS fell 1.5 percent to 7.66 reais in Sao Paulo today, extending a loss this year to 13 percent compared with the Brazilian benchmark’s 1.7 percent gain.

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