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World’s Biggest Meat Producer Struggles With Bad Beef Allegations

Acid on your steak? A Brazilian probe of the industry could hurt the IPO prospects of JBS.

Not long ago, JBS SA was in the vanguard of Brazil’s global ambitions, transforming itself into the world’s largest meat producer by snagging overseas rivals in a decade-long, $20 billion acquisition spree. Now, just as Brazil is mired in recession and a seemingly endless corruption scandal, JBS is facing a crisis of its own.

Authorities in Brazil said on March 17 they’re investigating evidence that employees of JBS and at least 20 other companies bribed government officials to approve the sale of tainted meat. Federal police raided slaughterhouses and alleged some operators stuffed sausages with cardboard, used acid to mask the smell of spoiled steaks, or knowingly shipped salmonella-tainted cold cuts. In a statement, JBS says it “is not accused of selling tainted or rotten meat,” nor have any actions been taken against JBS executives or managers.