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Brazilian BRF to acquire food production plant in China

Posted on by L. Dreeye
Brazilian BRF to acquire food production plant in China

This strategic move into China is part of BRF’s broader global expansion efforts, which also include investments in the Middle East. Photo: Pavel Kapysh/Shutterstock.

BRF has entered into a deal to acquire a food processing plant in China from fellow meat major OSI Group.

The company, owned by Henan Best Foods, a subsidiary of the American OSI Group, is being acquired for $43 million (R$248.5 million).

For BRF, the deal marks the “beginning of industrial operations” in China, where the company already has a commercial presence.

Built in 2013, the plant has two food processing lines with an annual capacity of approximately 30,000 tons.

BRF, which owns the Sadia, Perdigão and Qualy brands, plans to invest about $36 million to expand to two additional lines, which will increase production to 60,000 tons per year.

The project is expected to create about 850 new jobs, the company noted.

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In a statement, BRF said: “This acquisition is in line with the company’s strategy to expand its global presence by diversifying its footprint and strengthening BRF’s competitiveness by advancing its value-added product offering.”

BRF expects the deal will allow it to “more effectively respond to regional needs” and provide “direct access to the Chinese market.”

Completion of the transaction is subject to the fulfillment of conditions, including regulatory approval and restructuring of the plant’s assets, the company noted.

In October, BRF, through a joint venture, acquired a 26% stake in the Saudi Addoha Poultry Company for $84.3 million.

BRF’s international segment showed growth with EBITDA of R$1.6 billion in the third quarter of 2024 with a margin of 22.2%, up 548.5% from the same quarter in 2023.

The growth was driven by increased sales of processed products and a recovery in prices for pork cuts.

BRF reported a net profit of 1.1 billion reais in the third quarter, compared with a net loss of 262 million reais in the corresponding period a year earlier.

Net revenue for the three months under review rose 12.4% to 15.5 billion reais from 13.8 billion reais in the same period in 2023.