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

JBS S.A. is pursuing a dual listing in Brazil and the United States via JBS N.V. to enhance its global profile and shareholder value.

Summary

• JBS S.A. intends to pursue a dual listing of its shares in Brazil and the United States through JBS N.V., a Dutch entity.
• The dual listing aims to adapt JBS's corporate structure to its global operations, potentially unlock share value, and expand investment capacity.
• The process involves a merger of shares where JBS Participaes will merge all JBS S.A. shares not already held by it.
• JBS S.A. shareholders will receive one redeemable preferred share in JBS Participaes for every two JBS S.A. shares, which will then be redeemed for BDRs backed by JBS N.V. Class A shares.
• JBS N.V.'s capital structure will include Class A shares (traded on the NYSE), Class B shares (with ten votes each), and Conversion Shares.
• A cash dividend of R$1.00 per share, totaling R$2,218,116,370, is proposed, contingent on the EGM's approval of the Merger of Shares.
• The dual listing is subject to regulatory approvals, including SEC effectiveness and CVM registration.
• KPMG Auditores Independentes Ltda. has been hired to prepare an appraisal report of JBS S.A.'s shares, valuing the company's net asset value at R$44,780,867,425.93 as of December 31, 2024.

Sentiment

Score: 7

Explanation: The document is generally positive, outlining the strategic benefits of the dual listing and emphasizing the company's commitment to growth and shareholder value. However, it also acknowledges potential risks and complexities associated with the transaction.

Positives

• The dual listing is expected to strengthen corporate governance.
• It should increase JBS's visibility among global investors.
• The move is expected to broaden access to a wider investor base.
• It will increase flexibility in using equity for financing.
• The dual listing should 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 (indirectly, through LuxCo) 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.
• Unforeseen liabilities could arise.
• There are risks related to anticipated tax treatment.
• The process is subject to future capital expenditures, revenues, and expenses.
• Economic performance, indebtedness, and financial condition could be impacted.

Future Outlook

JBS aims to complete the dual listing to strengthen corporate governance and expand its investor base, driving long-term value for stakeholders.

Management Comments

• The Dual Listing aims to create a structure that enables JBS S.A. to better reflect its global presence and its international operations, as well as to implement its growth strategy in order to improve its ratings and maximize value to its shareholders.

Industry Context

The dual listing is part of a broader trend of companies seeking access to global capital markets and increased visibility among international investors.

Comparison to Industry Standards

• Comparable companies that have pursued dual listings include ArcelorMittal (listed in Europe and the US) and Unilever (formerly listed in both the UK and the Netherlands).
• These companies aimed to broaden their investor base and access different pools of capital.
• The success of a dual listing depends on factors such as regulatory compliance, investor appetite, and the company's ability to manage the complexities of operating in multiple jurisdictions.

Stakeholder Impact

• Shareholders: Expected to benefit from increased share value and access to global markets.
• Employees: No material changes to the current operating and managerial structure of JBS S.A. are expected.
• Customers: No direct impact on customers is anticipated.
• Suppliers: No direct impact on suppliers is anticipated.
• Creditors: The dual listing is expected to reduce the cost of capital.

Next Steps

• Shareholders will vote on the proposed dual listing at the Extraordinary General Meeting (EGM) on May 23, 2025.
• JBS N.V. will seek regulatory approvals from the SEC and CVM.
• The company will inform the market about the implementation date of the dual listing.

Key Dates

Keywords

dual listing, JBS, JBS N.V., BDR, NYSE, merger, shares, Brazil, SEC, CVM