425: JBS Eyes Dual Listing in Brazil and U.S. to Boost Global Profile

JBS S.A. is proposing a corporate restructuring and dual listing of its shares in Brazil and the United States to enhance its global presence and unlock shareholder value.

Summary

• JBS S.A. intends to pursue a dual listing of its shares on both the Brazilian and U.S. stock exchanges.
• The restructuring involves JBS N.V. becoming the ultimate holding company, with its Class A shares trading on the NYSE and BDRs on the B3.
• The dual listing aims to adapt JBS's corporate structure to its global operations, unlock shareholder value, and expand investment capacity.
• The process includes a merger of shares, with JBS Participaes issuing redeemable shares to JBS S.A. shareholders, which will then be redeemed for BDRs.
• A cash dividend of R$1.00 per share, totaling R$2,218,116,370, is proposed, contingent on the approval of the Merger of Shares.
• The capital structure of JBS N.V. will consist of Class A shares (1 vote), Class B shares (10 votes, convertible), and Conversion Shares.
• A limited conversion period will allow eligible shareholders to convert Class A shares into Class B shares, subject to certain limitations to maintain a minimum free float.
• The dual listing is subject to shareholder and regulatory approvals, including SEC effectiveness and B3/CVM registration.
• KPMG Auditores Independentes Ltda. has been engaged to prepare an appraisal report on the value of JBS S.A. shares.

Sentiment

Score: 7

Explanation: The document is generally positive, outlining the strategic benefits of the dual listing and the steps being taken to achieve it. However, it also acknowledges potential risks and challenges, resulting in a balanced sentiment score.

Positives

• The dual listing aims to adapt JBS's corporate structure to its global operations.
• The dual listing has the potential to unlock the value of JBS's shares.
• The dual listing will expand investment capacity to strengthen conditions for growth and competition with global competitors.
• The dual listing will further strengthen corporate governance.
• The dual listing will increase JBS's visibility among the global investor community.
• The dual listing will broaden access to a wider base of investors.
• The dual listing will increase flexibility in the use of equity as a source of financing.
• The dual listing will reduce the cost of capital.

Negatives

• The dual listing will result in the cessation of trading JBS S.A. common shares on the B3s Novo Mercado listing segment.
• The voting power of the Controlling Shareholders may increase compared to the current voting power they have on JBS S.A.

Risks

• The completion of the Dual Listing is subject to shareholder and regulatory approvals.
• The completion of the Dual Listing is subject to approval of the Class A Shares for listing on the NYSE.
• The completion of the Dual Listing is subject to approval of the Sponsored Level II BDR Program by the CVM and admission for listing of the BDRs by B3.
• The total costs and expenses related to the implementation of the Dual Listing, will amount to approximately R$94,655,000.00 by the time the transaction is implemented.

Future Outlook

JBS aims to complete the dual listing process and believes this move will drive lasting value for shareholders, team members, and areas around the world where it operates.

Industry Context

The dual listing reflects a trend among global companies to seek access to larger capital markets and enhance their international profile, particularly in sectors with significant global operations.

Comparison to Industry Standards

• Comparable companies that have pursued dual listings include ArcelorMittal (listed in Europe and the US) and Vale (listed in Brazil and the US).
• These companies sought to broaden their investor base and access different pools of capital.
• The success of JBS's dual listing will depend on factors such as market conditions, investor appetite, and the company's ability to meet regulatory requirements in both Brazil and the U.S.

Stakeholder Impact

• Shareholders: Potential for increased value and access to global markets.
• Employees: No material changes expected in the current operating and managerial structure.
• Investors: Broader access to a wider base of investors.
• Customers: No material changes expected in the current operating and managerial structure.
• Suppliers: No material changes expected in the current operating and managerial structure.
• Creditors: Increased flexibility in the use of equity as a source of financing, paving the way to fundraising through issuing shares and, consequently, reduce the need to incur in debt to support growth.

Next Steps

• Shareholders to vote on the proposed dual listing at the Extraordinary General Meeting on May 23, 2025.
• Obtain necessary regulatory approvals from the SEC, CVM, and B3.
• Implement the Merger of Shares and Redemption process.
• Commence trading of JBS N.V. Class A shares on the NYSE and BDRs on the B3.

Key Dates

Keywords

Dual Listing, JBS, Shares, BDR, NYSE, B3, Merger, Listing, Corporate Restructuring, Investment