Brazil’s antitrust authority has unconditionally approved the merger of Marfrig and BRF, paving the way for the formation of a giant player in the meat industry, MBRF Global Foods.
The Administrative Council for Economic Defense, or CADE, held an extraordinary session today — only the fourth in the authority’s 63-year history — to reach a conclusion on the deal involving the Brazilian companies. Councilor Carlos Jacques Vieira Gomes cast the final pending vote.
Councilor Gomes said during a regular session on Wednesday that he wanted to vote in advance, but the case could not be added to the agenda. He had requested more time to examine the case on Aug. 20, although CADE’s Tribunal had already secured a majority of votes to clear the merger.
Marfrig finally received clearance from the agency to purchase all of BRF’s remaining shares, creating MBRF Global Foods, a player with an annual revenue estimated at 152 billion reais ($28 billion).
Today’s decision is aligned with the recommendation of CADE’s Superintendence, whose technical note ruled out potential competition risks from the merger, both related to horizontal overlap and vertical integration.
Notice in the case was filed notified in late May and the deal was approved under the fast-track procedure in early June. However, it returned to discussion after rival Minerva requested to be a third-party in the review.
Minerva argued the merger could lead to unilateral and coordinated effects in the fresh beef market, because its shareholder Saudi Agricultural and Livestock Investment Company (Salic), from Saudi Arabia, also holds stakes in both BRF and Marfrig.
Initially, CADE’s interim president, Gustavo Augusto Freitas de Lima, who was also the lead councilor on the review, accepted Minerva’s appeal and partially upheld it. He said that potential harm could come from Salic in the future.
Councilor Victor Oliveira Fernandes disagreed with de Lima’s view, and said the alleged interlocking directorates risk does not bring any competition concerns.
CADE’s Tribunal did not admit Minerva’s appeal, and the Superintendence decision was unanimously confirmed.
Before today’s approval, Marfrig already owned 50.49 percent of BRF’s shares. The relationship between two companies began in 2021 when Marfrig bought a 20 percent equity stake in BRF. CADE had already given the green light to prior transactions involving both companies in 2021 and 2023.
✔️ Marfrig produces high value-added foods, with a primary focus on animal protein, especially beef. Marfrig’s portfolio includes hamburgers and various ready-to-eat options sold through retail, wholesale, and food service channels in Brazil.
✔️ BRG is part of Grupo Marfrig and operates across the entire production chain, from breeding to slaughtering poultry and pigs. BRF processes and distributes fresh meat, processed foods, pasta, margarine, and pet food.
Source: MLex
