Brasil Foods Announces Acquisition of Federal Foods Limited
BRF will sell and distribute its portfolio of products in the UAE through Federal Foods, including Sadia and Perdix brands, and the portfolio from the processed products plant which will start operating in 2013.
8 Oct 2012 --- Brasil Foods S.A., acting in accordance within the terms of Instruction Nº 358 of the Brazilian Securities and Exchange Commission of January 3, 2002 and § 4 of art. 157 of Act Nº 6.404/76, announces that it has signed a binding offer to acquire, through its subsidiary in Austria, a 49% share equity stake, and management control of Federal Foods Limited (“Federal Foods”), a privately-held company headquartered in Abu Dhabi, in the United Arab Emirates. The remaining share equity stake in Federal Foods will be maintained by Al Nowais Investments, the current owner of Federal Foods.
Established in 1991, Federal Foods is a leading food company in the United Arab Emirates, catering to a full spectrum of retail, food service and wholesale clients. The company operates 6 branches in the United Arab Emirates and 1 in the State of Qatar, with over 1,350 employees and a logistics fleet over 260 chilled/frozen vans and trucks. It reached US$ 266 million net sales and distributed 92 thousand tons of products in 2011.
Federal Foods has been a distributor of Sadia products in the United Arab Emirates for over 20 years. In addition to Sadia products, it distributes a range of chilled, frozen and dry products from other brands and suppliers. Currently, BRF products already account for approximately 65% of Federal Foods total net sales. BRF reiterates its intention to continue the partnerships built over time between Federal Foods and current suppliers.
BRF will sell and distribute its portfolio of products in the UAE through Federal Foods, including Sadia and Perdix brands, and the portfolio from the processed products plant which will start operating in 2013.
This acquisition is in line with BRF’s strategic plan to internationalize the company, accessing local markets, strengthening BRF’s brands and distribution and expanding its product portfolio in the Middle East.
BRF investment for the acquisition will amount to US$ 36 million, in return for a 49% share equity stake in Federal Foods. BRF will hold management control as established in the Shareholders Agreement, and will consolidate Federal Foods financial statements.
The closing of this transaction will depend on the successful completion of a legal and accounting due diligence, which is expected to occur over the following months.
