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Tyson Foods Inc. has reached a definitive agreement with JBS SA to sell its poultry businesses in Mexico and Brazil. According to a news release, the transaction is valued at $575 million and will be paid for in cash.
The sale is expected to be completed by the end of 2014. JBS and Pilgrim's Pride currently expect to maintain all the operations working to capacity with the existing workforce and to maintain all labor contracts in both countries.
"Although these are good businesses with great team members, we haven't had the necessary scale to gain leading share positions in these markets," Tyson CEO Donnie Smith said in the release. "In the short term, we'll use the sale proceeds to pay down debt associated with our acquisition of Hillshire Brands. Longer term, we remain committed to our international business and will continue to explore opportunities to extend our international presence."
Tyson Foods' Mexican business will be acquired through Pilgrim's Pride, whose majority owner is JBS USA Holdings Inc., a wholly owned subsidiary of JBS SA. The Brazilian business is to be acquired through JBS Foods, also a wholly owned subsidiary of JBS SA.
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