Cooke Seafood confirms interest in Huon Aquaculture takeover setting stage for battle with JBS
A potential suitor for Huon Aquaculture described by a Tasmanian fishing organisation as a ‘nicer looking version of JBS’ has confirmed its interest in the company’s takeover.
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A potential suitor for Huon Aquaculture has broken its silence and confirmed its interest in the Tasmanian company, setting the stage for a hotly contested battle with meat processing giant JBS.
Cooke Seafood, a $2.6 billion (AUD) aquaculture company headquartered in the Canadian province of New Brunswick, was rumoured to have made an offer for Huon through an expression of interest process earlier this year, only to be pipped by meat processing multinational JBS.
Huon founders Peter and Frances Bender have recommended that shareholders accept JBS’s offer to buy the company for $3.85 a share, pending Foreign Investment Review Board approval and unless a more favourable offer arises. The Brazilian company has also made a parallel offer to buy Huon, with a 50.1 per cent minimum acceptance offer.
Cooke’s operations encompass Atlantic salmon, sea bass and seabream farming, wild fishery divisions, and one of Latin America’s biggest prawn farms. It has more than 10,000 employees in 10 countries, including the United States, Scotland, Costa Rica and Chile.
Glenn Cooke, the company’s chief executive, said Cooke’s aim was to “grow responsibly” and that it believed Tasmania was “an attractive state to invest in”.
“Huon holds tremendous promise as an established company to continue producing world-renowned salmon and build upon the region’s talented fish farming workforce,” Mr Cooke said.
“Cooke is committed to continuous improvement of quality and environmental performance. Through our many certifications and partnerships with research institutions, we continue to set the highest standards for responsible harvesting and sustainable processes.”
Melbourne-based corporate advisory firm Kidder Williams, headed up by investment banker and former Tassal owner David Williams, has been appointed to advise Cooke.
Tasmanian Alliance for Marine Protection co-chair Peter George has said a JBS takeover would represent the “worst possible outcome” for Huon, but described Cooke as “a nicer looking version of JBS” that was “still committed to sea-based operations”.
“There’s got to be a commitment to get out of the ocean,” he said.
Mining magnate Andrew Forrest, one of Australia’s richest men, is among Huon’s largest shareholders, with his company Tattarang increasing its holding from 7 per cent to 18.51 per cent last week.
Dr Forrest has raised concerns about JBS’s environmental credentials, which the company has countered by saying it shares his view that “good business must also be good for the environment” and that JBS had an “uncompromising global commitment to sustainability and animal welfare”.
‘JBS will struggle’ to take control of Huon Aquaculture claims Tassal buyer
BRAZILIAN meat processing giant JBS will struggle to get approval from the Foreign Investment Review Board to take control of Huon Aquaculture, says the man who bought Tassal out of receivership nearly two decades ago.
It comes as JBS faces the possibility of a probe in the US, with Senate Foreign Relations Committee chairman Bob Menendez and Ranking Member of the SFRC Subcommittee on the Western Hemisphere Marco Rubio writing to Secretary of the Treasury Janet Yellen to request that the committee conduct a review of the company’s transactions.
The senators have said that when foreign companies “benefit from corrupt practices and spread them to US markets”, the need for a “thorough investigation” is apparent.
Melbourne-based investment banker David Williams, who bought Tassal for $42.5 million in 2003 and floated it on the ASX, said he doubted that JBS’s Huon takeover bid would be rubber-stamped by the FIRB.
“I don’t think they can get FIRB approval,” Mr Williams told the Mercury.
“What Tasmania really needs most at the moment is a safe pair of hands, an experienced operator who can take the industry to the next level … and is world’s best practice.”
Mr Williams, the founder of corporate advisory firm Kidder Williams, is the largest private water-holder in Tasmania, leasing his 10,000 litres to farmers.
Huon founders Peter and Frances Bender have recommended that shareholders accept JBS’ offer to buy the company for $3.85 a share, unless a more favourable offer arises. Last Friday, JBS made a parallel offer to buy Huon, with a 50.1 per cent minimum acceptance offer.
It was interpreted as a move to reduce the influence of mining magnate Andrew ‘Twiggy’ Forrest, a major Huon shareholder who, on behalf of his company Tattarang, made public comments last week about JBS’s environmental and animal welfare practices.
“JBS shares Tattarang’s view that good business must also be good for the environment,” JBS said in a statement on Friday.
“JBS has written to Tattarang directly outlining its uncompromising global commitment to sustainability and animal welfare.”
Tasmanian Alliance for Marine Protection co-chair Peter George wrote to federal Treasurer Josh Frydenberg and FIRB chair David Irvine on Monday to urge them to “use your foreign investment review powers to reject the proposed takeover” of Huon by JBS.
Meanwhile, a rival bidder for Huon, Canadian aquaculture company Cooke Seafood, is rumoured to be mulling a second offer to buy the Tasmanian company.
Push for ‘urgent’ investigation into JBS
THE Committee on Foreign Investment in the US has been asked to conduct a formal review of the transactions of meat giant JBS as it buys up businesses that country.
JBS – which owns an abattoir at Longford in Tasmania’s north – has made a takeover bid for Huon Aquaculture and questions have been raised about the company’s environmental and animal welfare record.
The Brazilian meat company edged closer to its acquisition aim on Friday when it made a parallel offer for Huon but with a 50.1 per cent minimum acceptance offer – down significantly from the 75 per cent in the original bid.
It means Huon investor Andrew “Twiggy” Forrest will have less influence over the deal going through.
In the US, Senate Foreign Relations Committee chairman Bob Menendez and Ranking Member of the SFRC Subcommittee on the Western Hemisphere Marco Rubio have written to Secretary of the Treasury Janet Yellen to renew their request that the committee conduct the review.
JBS is owned by Wesley and Joesley Batista who have a net worth of over $6bn.
In the letter, the politicians said that over the past 14 years, JBS had become increasingly active in the US food sector, acquiring numerous companies.
“When foreign companies benefit from corrupt practices and spread them to US markets, they jeopardise our economic security, present direct risks to our businesses, and undermine our efforts to fight corruption abroad,” the letter read.
“With JBS planning further US acquisitions in the near future, the need for a thorough investigation is urgent.”
The letter claims JBS had repeatedly used its significant presence in the meat packing sector to inflate its profits at American families’ expense.
“On February 24, 2021, Pilgrim’s Pride, which is majority owned by JBS, pleaded guilty to conspiring to increase chicken prices and pass the costs on to consumers, and agreed to pay a $107.9m fine. On April 20, 2021, JBS USA agreed to pay $12.75m to resolve a series of civil antitrust cases involving similar alleged price-fixing in the pork industry,” the letter said.
JBS has said it welcomed feedback from Huon shareholders in response to its proposal, in particular comments by Dr Forrest on behalf of his company Tattarang about JBS’s environmental and animal welfare management practices.
“JBS shares Tattarang’s view that good business must also be good for the environment. JBS has written to Tattarang directly outlining its uncompromising global commitment to sustainability and animal welfare,” the company said.
“This commitment extends to Huon, where JBS intends to build on the legacy of the Bender family, upholding the highest standards for superior quality, fish health and sustainable farming practices – from water management to animal welfare, net zero emissions and stock densities.”
JBS turns up heat on Forrest over Huon takeover
JBS is turning up the heat on billionaire businessman Andrew “Twiggy” Forrest as it tries to take over salmon producer Huon Aquaculture.
In a statement to the ASX on Friday night, JBS has made a parallel offer for Huon but with a 50.1 per cent minimum acceptance offer — down significantly from the 75 per cent from the original bid.
In the statement, authorised by JBS chief executive Brent Eastwood, JBS offers the same price of $3.85 a share.
“JBS welcomed the feedback from Huon shareholders in response to its proposal, in particular comments by Andrew Forrest on behalf of Tattarang Agrifood Pty Ltd (“Tattarang”) regarding its prioritisation of environmental and animal welfare management practices,” Mr Eastwood said.
“JBS shares Tattarang’s view that good business must also be good for the environment.
“JBS has written to Tattarang directly outlining its uncompromising global commitment to sustainability and animal welfare.”
Mr Eastwood said JBS “unequivocally supports the principle of ‘no pain, no fear’ animal welfare across its global operations”.
Shadforth Financial Group private wealth adviser Sam Baker said the JBS offer made Dr Forrest’s 18 per cent shareholding “less significant”.
“Dr Forrest now can’t increase his stake more than 20 per cent without making an offer for the whole company,” Mr Baker said.
“The ball is now back in his court to make a takeover offer.
“Huon is at pains to point out that any takeover is still subject to an independent review and is in the absence of any superior proposal.”
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