A BRAZILIAN meat processing giant has swallowed smallgoods producer Primo Group as the trend for offshore companies to dine out in Australia gathers pace.
Brazil’s JBS — the world’s biggest food processing company — has signed a $1.45 billion deal through its Australian offshoot to buy Primo, a 29-year-old family business.
Australia’s biggest ham, bacon and smallgoods producer, Primo had been 70.1 per cent owned by private equity group Affinity Equity Partners since 2011.
Its brands include Primo Smallgoods, Hans and Beehive, and it boasts a 3000-strong workforce and five processing plants across Australia and New Zealand.
The deal comes hot on the heels of a $1.3 billion Singaporean-Hong Kong joint offer for breadmaker Goodman Fielder.
It also bookends a year in which Canadian dairy heavyweight Saputo waged a fierce battle for control of Warrnambool Cheese and Butter Factory, snapping up almost 90 per cent of the group in February.
IG Markets strategist Evan Lucas said the recent signing of a free-trade agreement with China, Australia’s biggest trading partner, had helped put Australian agribusinesses front of mind among global investors.
“These sort of deals are probably going to be a fairly regular thing over the next year and a bit,” Mr Lucas said.
It also comes as local movers and shakers Andrew Forrest, chairman of Fortescue Metals, and billionaire Gina Rinehart invest millions in beef and milk producers respectively to cash in on the expected boom in demand from China’s increasingly affluent middle-class.
JBS Australia chief Brent Eastwood said the acquisition provided a great opportunity for the group to expand Primo’s sales into offshore markets, including China.
Primo chief Paul Hitchcock said he welcomed the deal.
The sale is subject to regulatory approvals