Market News & Headlines >> JBS Pulls U.S. IPO for Food Subsidiary
Brazilian meatpacking giant JBS SA has withdrawn a planned $500 million U.S. initial public offering of stock in its processed food subsidiary JBS Foods International BV, almost six months after a string of corruption and food safety scandals in Brazil hurt investor demand for the deal.
In a Friday filing with the U.S. Securities and Exchange Commission, Netherlands-based JBS Foods International requested a withdrawal of the IPO. While neither company gave a new timetable for the IPO, JBS said in a statement to Reuters News Service that a U.S. listing of JBS Foods "is the best way possible to maximize shareholder value."
Parent JBS and the processed food subsidiary first announced plans for a U.S. offering on Dec. 5. São Paulo-based JBS, the world's No. 1 meatpacker, reaffirmed plans to list the subsidiary in August, saying a transaction could take place by the end of next year.
The proposal for the JBS Foods International IPO was first put to test in March, after a scandal over alleged bribery of health officials triggered bans on Brazilian meat exports. Two months later, two members of the Batista family, which controls JBS, agreed to a plea bargain deal in Brazil relating to a corruption probe.
The collapse of the IPO plan is a setback for the Batista family, which owns 42% of JBS and saw the IPO as a way to improve JBS's global standing. The transaction was seen as a way to help decouple JBS's businesses from Brazil -- where reputational issues have impaired share performance in recent months.