Tyson enters Brazilian poultry industry with 3 transactions

19-09-2008 | |

Tyson Foods is continuing the strategic expansion of its international business by investing in the Brazilian poultry industry, the company has announced.

Tyson has signed purchase agreements with 3 poultry companies in southern Brazil. Each is vertically integrated and offers the potential for domestic and international sales growth.
Terms of the planned Brazilian transactions were not disclosed, however, company officials confirmed Tyson will acquire Macedo Agroindustrial and Avícola Itaiópolis (Avita), both located in the state of Santa Catarina, and will initially have 70% ownership of Frangobrás in the state of Paraná. Tyson expects to conclude all three transactions in the next 60 days.
Santa Catarina and Paraná are leading corn and soy-producing states in Brazil. This is important since grain represents about half of the cost of raising a chicken. Both Brazilian states also have excellent access to major ports for exporting products.
“Our investment in these companies is a key part of our international strategy, especially since Brazil is currently the world’s leading chicken exporter and third largest chicken producer behind the US and China,” said Rick Greubel, group vice president and international president for Tyson Foods.
“The Brazilian population consumes about 37 kg (81 pounds) of chicken per person per year compared to 45 kg (99 pounds) in the US,” he said. “With the economic stability and a growing middle class, the per capita consumption of chicken will continue to increase in Brazil. In addition, our Brazilian operations will give us greater access to markets that are currently buying little to no poultry from the US”