BRF and Marfrig merger hits a dead end

Marfrig and BRF have given up on the possible merger, announced at the end of May. According to a statement sent by the two companies to the Securities and Exchange Commission, the reason was the lack of consensus regarding “the governance of society” that would result from the transaction.

The two refrigerators had approved the signing of a memorandum that provided for a 90-day exclusivity period.

In a statement, BRF global president Lorival Nogueira Luz Jr. stated that “Despite the conclusion of negotiations for the combination of its businesses, the commercial relationship between the company and Marfrig will remain unchanged and there will be no changes in the practices, conditions, and terms foreseen in contracts concluded by them.”

Marfrig, in a note signed by the vice president of finance and DRI, Marco Antonio Spada, also said that the closing of the negotiations “will not affect other commercial partnerships between the company and BRF S.A.”

BRF is the leader in Brazil in the production of chicken and pork meat. On the other hand, the focus of Marfrig is the production of beef. The union of the two would generate a company with annual revenues of about R$76bn.

In the following chart, based on data from Dataliner, shows beef export trends ofBRF and Marfrig from January 2015 to May 2019.

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