JBS looks to outflank Andrew Forrest with ‘parallel’ bid for Huon Aquaculture

Brazilian food giant JBS has launched a parallel takeover bid for Huon Aquaculture as it looks to outmanoeuvre mining billionaire Andrew Forrest.

Co-founder of Huon Aquaculture Frances Bender at the salmon farming facility at Hideaway Bay in southern Tasmania. Picture: Peter Mathew

Brazilian food giant JBS has launched a parallel takeover bid for Huon Aquaculture as it looks to outmanoeuvre mining billionaire Andrew Forrest in the tussle for the Tasmanian salmon company.

In an update to the market late on Friday, Huon told shareholders JBS had made an off-market takeover offer for the company for the same price as the original scheme of arrangement, at $3.85 per share.

The second bid, which needs a 50.1 per cent acceptance from shareholders, will run parallel to the original takeover offer, which requires 75 per cent shareholder approval.

The meat processor’s original bid, lobbed earlier this month, appeared to have been thwarted by Mr Forrest when it emerged last week that his family company, Tattarang, had upped its stake in Huon to just under 19 per cent.

Tattarang paid $46m to lift its stake in the company to 18.5 per cent, a move flagged in The Australian’s Data Room column.

In an interview with the Australian, Mr Forrest, who is chairman of Tattarang, said his company continued to support the work by Huon’s founding family, the Benders, to improve the image of the world salmon industry. This included moves to eliminate the use of fish meal to feed the salmon.

He said Tasmania had a “globally significant opportunity to be the epicentre of this change, to lead the world and become the leading jurisdiction in the aquaculture industry that is environmentally sustainable and ethically produced”.

But he said he was also concerned at the global practices of JBS, claiming they were not adopting “no pain, no fear” practices when killing their animals.

JBS Australian chief executive Brent Eastwood rejected the allegations.

“As the world’s largest animal protein-based company, ensuring the wellbeing of the animals under our care is an uncompromising commitment at JBS,” he said in a statement. “We are confident that a partnership with JBS will extend and improve upon Huon’s legacy of high standards for superior quality, fish health, welfare and sustainable farming practices.”

Huon also defended its environmental standards.

“Huon has been, over 35 years of operation, and continues to be, uncompromising in its commitment to the highest standards of animal husbandry, biosecurity, environmental management, and sustainable farming practices and has been at the forefront of continuous improvement in relation to environmental sustainability,” the company said.

Andrew Forrest.

JBS, meanwhile, had committed to ensuring the wellbeing of animals under its care and to “building on Huon’s legacy of high standards for superior quality, fish health, welfare and sustainable farming practices under its ownership”.

“JBS has notified Huon that they will provide further detail regarding their application of best practice standards in animal welfare and environmental sustainability for inclusion in the Scheme Booklet for all shareholders to consider,” the ASX-listed company said.

In the latest market update, Huon said that each of its directors, including the Benders, would vote in favour of the scheme and would also accept the second offer.

The family owns about 53 per cent of Huon‘s issued shares.

Shareholders do not need to take any action at this time and will receive details on both the scheme and the off-market offer in late September.