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Tasmania's salmon farmer Huon Aquaculture being pursued by Brazilian meat giant JBS

The following is an excerpt from an article published by ABC.NET:  

Tasmanian salmon giant Huon Aquaculture is set to sell to a Brazilian meat processing company for almost half a billion dollars.

Late Friday, the Australian Securities Exchange (ASX) revealed the company had entered a deal with JBS, which would see the South American giant acquire 100 per cent of Huon's shares at $3.85 per share, should shareholders approve.

On Friday, Huon shares closed at $2.79.

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The deal has been reported as being worth $425 million — but one financial expert said the deal was likely worth up to $550m.

Huon's board of directors said the buyout was in shareholders' best interests, and has recommended they vote in favour of the deal.

Directors, including founders and major shareholders Frances and Peter Bender, said they intend to vote to support the sale.

The Benders have a controlling 53 per cent stake in the company, which is the second largest of the three salmon producers in the state, founded in 1986.

Photo: courtesy Akva Group

In a release, JBS said the deal has been approved by the controlling shareholders and take over is expected to be concluded by the end of this year, with the approval of the other shareholders and the Australian Foreign Investment Review Board.

Billionaire mining magnate Andrew Twiggy Forrest recently paid $20 million for a 7.5 per cent share in the company, while Australian Super currently owns 12 per cent.

Acquiring Huon's stocks will mark JBS's move into aquaculture, but it's the Brazilian multinational's second operation in Tasmania, with the company owning a beef cattle processing unit at Longford. 

JBS Australia's president and chief executive officer, Brent Eastwood, said the acquisition of Huon allows the company to further grow its Australian protein business.

"We look forward to continue growing on the leading salmon business Huon has created and working with its employees, customers and stakeholders to help the company realise this next phase of growth." 

On Saturday, Tasmanian Premier Peter Gutwein said in terms of his dealings with JBS, "they have demonstrated they are a very reasonable corporate citizen in their time in Tasmania and I don't expect that will change".

Deal valued at $550 million

Shadforth's financial advisor Sam Baker said the takeover would see JBS absorb Huon Aquaculture's debt.

"JBS, which is one of the largest food processing companies in the world, will look to take control of the company and potentially provide additional financial strength."

"They're holding around $120 million in debt, or about 43 per cent gearing, and this is one of the significant reasons why we're going through this process at the moment."

He said the deal actually values the company at about $550 million.

"The share offer is $425 million but it would also mean JBS takes on $120 million in company debt and there's also a dividend in the offer." 

JBS is valued at about $16 billion dollars. 

The Benders stand to make about $210 million from the deal. 

Shadforth financial adviser Sam Baker said if it goes ahead, Huon would no longer be listed on the Australian stock exchange and its financial reporting obligations would occur in Brazil. (continues...)

Author: Christopher Ham and Rebecca Hewett / ABC.NET | Read the full article by clicking de link here

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