The Brazilian meatpacking company has received conditional approval from the Brazilian Antitrust Authority, and could receive local updates in November.
The Brazilian Minerva “formally appealed” the decision of the Commission for the Promotion and Defense of Competition (Coprodec) of the Ministry of Economy and Finance (MEF) to reject the merger of this company with its compatriot Marfrig in Uruguay, due to what would end up being a “dominant position” in an already “highly concentrated” market. But while waiting for news in the country, business is moving forward in Brazil, where it received conditional approval for acquisitions in the northern country, as well as in Argentina and Chili.
In Uruguay, business is temporarily at a standstill. Meanwhile, the ambitious plan to Minerva Foods which involves the merger with Marfrig in several countries on the continent, obtained a conditional approval in Brazil by the CADE, the local Commission for the Defense of Competition. This implies that a reduced version was approved, according to Brazilian media and reported by Blasina y Asociados.
In this regard, both Minerva and Marfrig explained that CADE recommended the “approval of the transaction through the signing of a concentration controlwhich requires a reduction in the material and geographical limits set forth in the expansion restriction clause provided for in the agreement, which will not alter the other terms and conditions set forth in the agreement and the transaction.”
“In addition to the final and unappealable decision of CADE, the closing of the transaction is also subject to the verification of the other conditions precedent provided for in the agreement, which regulates the acquisition of assets in Brazil, Argentina and Chili”, Minerva added. Meanwhile, by constituting a separate business, the Uruguayan part is totally under the jurisdiction of the Coprodec.
Minerva’s appeal
The possibility that Minerva appeal the decision of the Coprodec The purchase of three of the four plants that Marfrig has in the country, which would leave a total of seven meat-packing plants and 45% of the slaughter in the hands of the former, was already being considered from the moment the official rejection of the operation became known. Although it also sought to evaluate other alternatives such as, for example, a direct conversation with the government to authorize, at least, the purchase of two plants, it finally resorted to the official administrative route.
The news was confirmed by Marfrig’s CEO in Uruguay, Marcelo Secco, who confirmed to the newspaper Cambio that “Minerva formally appealed” the decision of the Coprodec and that, now, all that remains is to know the decision of the Executive Branch, which has “until the end of November to ratify or not the resolution.”
If the final decision is to reject the deal, Secco said that Marfrig’s intention is to continue working and “be efficient” by improving the infrastructure of the plants.
Following the appeal, the parties that participated in the process were also consulted again by Coprodec: “The company is seeking to expand information on the presentation of the business as it was determined, so we will respond by providing further information, in the same line of argument that Coprodec had to reject the business,” said the president of the company. Rural Federation, Jorge Andrés Rodríguezto Radio Carve
Source: Ambito
