CCA welcomes JBS USA in Canada
Media Release
Calgary, AB – The Canadian Cattlemen’s Association (CCA) is pleased to learn that XL Foods Inc. has reached an agreement for JBS USA to assume the management of the beef harvesting and processing operations at Brooks, Alberta, effective immediately. Operations of the Brooks facility have been suspended since September 27, 2012 while corrective actions have been undertaken following a beef recall.
“JBS has a global reputation as a leader in the beef business,” said CCA President Martin Unrau. “Their sophisticated knowledge of modern beef harvesting management as well as extensive world-wide beef marketing network will be a valuable asset for the entire Canadian beef sector.”
JBS USA is a leading animal protein processor in the U.S. and Australia and a wholly owned subsidiary of Brazil-based JBS S.A., the world’s largest protein company. According to the company, the agreement also provides JBS USA an exclusive option to purchase the Canadian and U.S. operations of XL Foods. JBS USA holds an exclusive option to purchase XL properties including: the Lakeside beef packing plant; a beef packing plant in Calgary, AB; a feedlot in Brooks, AB, and the adjacent farmland acreage; a beef packing plant in Omaha, Neb.; and a beef packing plant in Nampa, Idaho. Upon exercising the exclusive option to purchase the above assets, JBS USA agrees to pay USD $50 million in cash and USD $50 million in JBS S.A. shares. Under no scenario will JBS USA assume any of XL Foods' debt or liabilities.
XL will continue to manage its other Canadian and U.S. operations during the option period. JBS USA will manage XL Lakeside, with the capacity to process 4,000 head of cattle per day, effective immediately.
The development is welcome news for Canada’s cattle producers as it establishes credible intentions for resumed operations at the plant following re-licensing that will ease the back up of market-ready cattle in Western Canada that has developed as a result of the temporary closure of the XL facility. XL processed between 30 and 40 per cent of Canada’s cattle.
Earlier today, the Canadian Food Inspection Agency (CFIA) said now that all carcasses in the XL plant have been processed it will commence a review of its observations of the enhanced food safety controls in place there. Once the review is completed, and the test results of the product are in hand, the CFIA will prepare a report of its assessment and make a recommendation on next steps. The CFIA said it expects to complete this work before the beginning of next week.
About JBS
JBS USA, an indirect, wholly owned subsidiary of JBS S.A., is a leading processor of beef, pork and lamb in the U.S. and a leading processor of beef in Australia. JBS USA processes, prepares, packages and delivers fresh, further-processed and value-added beef and pork products for sale to customers in more than 60 countries on five continents. JBS USA is also a majority shareholder of Pilgrim’s Pride Corporation, the second largest poultry company in the U.S.
Media Release
Calgary, AB – The Canadian Cattlemen’s Association (CCA) is pleased to learn that XL Foods Inc. has reached an agreement for JBS USA to assume the management of the beef harvesting and processing operations at Brooks, Alberta, effective immediately. Operations of the Brooks facility have been suspended since September 27, 2012 while corrective actions have been undertaken following a beef recall.
“JBS has a global reputation as a leader in the beef business,” said CCA President Martin Unrau. “Their sophisticated knowledge of modern beef harvesting management as well as extensive world-wide beef marketing network will be a valuable asset for the entire Canadian beef sector.”
JBS USA is a leading animal protein processor in the U.S. and Australia and a wholly owned subsidiary of Brazil-based JBS S.A., the world’s largest protein company. According to the company, the agreement also provides JBS USA an exclusive option to purchase the Canadian and U.S. operations of XL Foods. JBS USA holds an exclusive option to purchase XL properties including: the Lakeside beef packing plant; a beef packing plant in Calgary, AB; a feedlot in Brooks, AB, and the adjacent farmland acreage; a beef packing plant in Omaha, Neb.; and a beef packing plant in Nampa, Idaho. Upon exercising the exclusive option to purchase the above assets, JBS USA agrees to pay USD $50 million in cash and USD $50 million in JBS S.A. shares. Under no scenario will JBS USA assume any of XL Foods' debt or liabilities.
XL will continue to manage its other Canadian and U.S. operations during the option period. JBS USA will manage XL Lakeside, with the capacity to process 4,000 head of cattle per day, effective immediately.
The development is welcome news for Canada’s cattle producers as it establishes credible intentions for resumed operations at the plant following re-licensing that will ease the back up of market-ready cattle in Western Canada that has developed as a result of the temporary closure of the XL facility. XL processed between 30 and 40 per cent of Canada’s cattle.
Earlier today, the Canadian Food Inspection Agency (CFIA) said now that all carcasses in the XL plant have been processed it will commence a review of its observations of the enhanced food safety controls in place there. Once the review is completed, and the test results of the product are in hand, the CFIA will prepare a report of its assessment and make a recommendation on next steps. The CFIA said it expects to complete this work before the beginning of next week.
About JBS
JBS USA, an indirect, wholly owned subsidiary of JBS S.A., is a leading processor of beef, pork and lamb in the U.S. and a leading processor of beef in Australia. JBS USA processes, prepares, packages and delivers fresh, further-processed and value-added beef and pork products for sale to customers in more than 60 countries on five continents. JBS USA is also a majority shareholder of Pilgrim’s Pride Corporation, the second largest poultry company in the U.S.
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