UPDATE 2-Tyson to buy three Brazilian poultry companies

Thu Sep 18, 2008 2:09pm EDT

Related Topics

(Adds $200 mln investment, company comments. Changes dateline from NEW YORK)

SAO PAULO, Sept 18 (Reuters) - Tyson Foods Inc (TSN.N), the largest U.S. meat producer, said on Thursday that it planned to buy three Brazilian poultry companies in its entry into Latin America's biggest economy.

Springdale, Arkansas-based Tyson said it would acquire Macedo Agroindustrial and Avicola Itaiopolis (Avita), both in Santa Catarina, and a 70 percent stake in Frangobras in Parana.

Brazil is a priority country for Tyson, which expects to see increased consumption there due to economic stability and a growing middle class, Rick Greubel, Tyson vice president, said at a news conference in Sao Paulo.

"Beyond this, through our Brazilian operation we will have export opportunities to other countries that we have limited access to from the United States," he said.

Specific terms were not disclosed. But the firm said its expansion plans in Brazil, including the cost of the acquisitions, would cost around $200 million. Tyson expects to close on the three transactions within the next 60 days.

Tyson's entry into Brazil, the world's largest exporter of chicken and beef and a major source of soybeans, corn and pork, has long been expected.

Santa Catarina and Parana are leading corn- and soy-producing states in Brazil, and both have access to major ports.

Tyson said it planned to double production at the Macedo plant to 176,000 birds per day and to increase daily chicken production to 320,000 birds at the Avita and Frangobras plants. The firms' brand names would not be changed for local trade.

Chicken sales accounted for 31 percent of Tyson's $26.9 billion in revenue last year.

Tyson shares were down 5 cents at $12.58 on the New York Stock Exchange. (Reporting by Sarah Coffey and Camila Moreira in Sao Paulo; Editing by Lisa Von Ahn and Brad Dorfman)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.