Pension fund Previ sells BRF stake after 31 year

BRAZIL – Brazilian pension fund Previ has announced the sale of its entire minority stake in meat processor BRF, ending a three-decade-long investment in the company.

The fund, which represents employees of state-run lender Banco do Brasil, disclosed on Monday that it sold its shares for approximately US$340.3 million (R$1.9 billion).

According to a statement on its official website, Previ made the decision to withdraw from BRF in response to uncertainties surrounding the company’s ongoing merger with Marfrig Global Foods.

The sale comes just weeks after Brazil’s antitrust regulator, CADE, approved the merger between BRF and Marfrig, clearing a key hurdle for the companies to combine operations.

CADE’s June 3 decision confirmed that the transaction posed no risk to competition in the market and would take effect within 15 days unless challenged.

With the regulatory approval in place, both companies scheduled shareholder meetings for June 18 to vote on the proposed merger.

If approved, BRF would become a wholly owned subsidiary of Marfrig, and existing BRF shareholders, excluding Marfrig, would receive 0.8521 Marfrig shares for every BRF share held.

The new merged entity, to be named MBRF Global Foods Co. S.A., is projected to have generated around US$27.8 billion (R$152 billion) in net revenue over the past year.

Roughly 38% of the combined company’s portfolio is expected to consist of processed food products under major Brazilian brands such as Sadia, Perdigão, Qualy, and Bassi.

In light of these developments, Previ stated that the share sale was a strategic move to safeguard its investments from potential market volatility associated with the corporate integration.

The fund also revealed plans to redirect the proceeds into long-term Brazilian government bonds, aligning with its long-term investment strategy.

Previ’s exit marks a significant shift in BRF’s ownership structure, especially considering its 31-year history as a stakeholder in the meat processor.

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