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05-07-2018
The Brazilian group BRF plans to sell Quickfood, which is also the maker of Goodmark and Vienissima, before the end of the year as part of a global divestment plan to reduce its debt. In the market, they see the exaggerated valuation and they warn that the recession could scare interested potentials
After announcing a plan to reduce its presence abroad and reduce its overall indebtedness, the Brazilian group BRF intends to obtain ] 500 million dollars with the sale of its badets in Argentina, concentrated under the company Quickfood . The amount represents one-third of the million Australian dollars that the owners of the patty hamburger brand will seek to collect also by selling companies in Europe and Thailand.
The decision was made by Pedro Parente the CEO of the Brazilian food giant and who took the reins of this group at the end of April.
Coming from Petrobras the executive replaced at the highest position of BRF Abilio Diniz launched a restructuring plan to cope with the severe economic crisis suffered by BRF and which l & rsquo; Had to face losses of nearly 350 million US dollars last year, aggravated by the multiple corruption scandals in which the Brazilian group was involved. One case was the "carne fraca" by which the neighboring country's justification detected a network that falsified the results of quality examinations carried out on product samples of the company that were to be exported to Europe.
In Argentina, the situation of BRF is similar. His company, Quickfood reduced its operations and dismissed staff after filing with the Ministry of Labor a request to open its procedure crisis prevention ].
Despite controlling two-thirds of the burgers market in the country, through Paty and GoodMark and about the third of the sausages with the brands Vieníssima and Hamond suffered heavy losses and currently operates with a negative net worth.
In fact, his last balance on the local stock market attributable to the first quarter of this year gave losses for $ 72 million and a negative equity of $ 510 million. dollars.
Meanwhile, its annual balance for 2017 showed a red from $ 742 million and a negative net worth of $ 619 million. BRF comes to him turn funds to support his activities and avoid bankruptcy . The last change took place in November of last year, for $ 49.7 million by way of an irrevocable capital contribution offer and account for future subscriptions of # 39; s shares.
Quickfood repertoire, funds were allocated to cancel the liabilities incorporate working capital and rebuild their badets. In this context, the sources of the local market of the meat consulted by iProfesional explain that the complicated situation that Quickfood crosses is framed in a commercial context which is observed complicated for almost all the 39, local industry.
In fact, they consider that this context and the need for the Brazilian group to sell on an urgent basis will give the bargaining power to potential interested parties in their local badets. Beyond this, Parente himself has already stated that BRF did not intend to lower its claims
nor to make any discount on the valuations already made to offer Quickfood on the local market.
"Our box is big enough not to make a decision in a hurry ," the executive told the Brazilian media. Anyway, its objective is that Quickfood has a new owner before the end of the year
Doubts on the market
However, on the market they doubt that the CEO of BRF can comply with this plan . They warn that the economic crisis, the fall of consumption, the devaluation and the recession in which the country penetrates could discourage and frighten potential investors
. criticize and consider the valorization made by the Brazilian conglomerate to more than 500 million dollars for its brands and factories for the processing and marketing of processed foods, refrigerated and frozen, such as hamburgers, sausages, vegetables and sausages, in addition to having a cold room.
These businesses are divided into three industrial factories located in the towns of San Jorge, Arroyo Seco (Santa Fe) and Baradero (Buenos Aires), and specializes in the slaughter of cattle, export of fresh cuts and the development of burgers, sausages, sausages
Beyond this strong presence in this business, there is At four years, his balance sheets show negative results which even framed it in the case of dissolution established by Article 206 of Law No. 19,550 on the companies
Its leaders warn since 2016 that the conditions of their local companies are negative and are conditioned by "sharp increases" of the price of the main entries (among them hacienda and cuts) that were caused by a double effect.
On the one hand, the devaluation of the exchange rate that up to this year already exceeds 53%. And on the other hand, the reduction and reduction of retained and quotas for the export of agricultural products, such as those of corn and soybeans.
According to reports sent by Quickfood's board of directors to the National Securities Commission (CNV), "the company was limited in its ability to move domestic prices immediately this significant increase in costs, given the context of domestic demand, which accounts for about 80% of sales. "
For this reason, erosion was generated margins of the company. Then, and to mitigate the loss of margins, the company stresses to have continued to "improve its operational efficiency and its costs, so as to absorb internally part of the price increase of [19659003] At the same time, he baderts that the removal of retained on beef has improved the margins of the export activity, which accounts for 20% of its activity In the country
For this year, the prospects of the company go through the recovery of profitability and margins of the company, together with a greater stability in the price of inputs and a "expected recovery of domestic consumption" .
In addition, it is explained that "the increase of repayments to the export of beef and its extension to processed meat in early 2017 suggest an improvement in the margins of export ".
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