Federal Court gives tick of approval for JBS to buy Huon Aquaculture
The controversial takeover of Huon Aquaculture by Brazilian meat giant JBS has overcome its final hurdle. Hear from the salmon giant’s new owners >>
Police & Courts
Don't miss out on the headlines from Police & Courts. Followed categories will be added to My News.
UPDATE, November 3, 2021:
THE controversial takeover of Huon Aquaculture by Brazilian meat giant JBS has overcome its final hurdle, with the Federal Court of Australia green-lighting the buyout.
As part of the takeover, shares in the salmon company owned by Western Australian mining magnate Andrew “Twiggy” Forrest will be compulsorily acquired by JBS.
On Wednesday, Justice David O’Callaghan heard shareholders were given “bespoke communication” and the voting process was conducted in “complete compliance” with legal requirements.
“There’s no reason the order shouldn’t be made approving the primary scheme,” Ian Jackman SC told the court via video link in Victoria.
Justice O’Callaghan said he would issue the orders on Wednesday and publish his full reasons in due course.
Under the scheme of arrangement, JBS will acquire 100 per cent of Huon’s shares at $3.85 per share — a $500 million acquisition.
With Huon now privately owned, it will be taken off the stock exchange.
JBS Australia CEO Brent Eastwood said the meat giant would become the legal owner of Huon after the scheme was officially implemented on November 17.
“JBS Australia is very pleased with the overwhelmingly positive response at last week’s shareholder meeting and today’s court approval,” he said.
“Over the coming weeks, JBS looks forward to engaging directly with Huon employees and also key Tasmanian environmental and government stakeholders.”
The scheme required approval from the Federal Court to make it legally binding after more than 99 per cent of Huon’s shareholders voted in favour of the takeover bid last week.
The voters included Mr Forrest, who asked JBS to reaffirm its commitment to animal welfare and environmental sustainability and adherence to the principle of “no pain, no fear” across its operations.
Shadforth Financial Group private wealth adviser Sam Baker said stock exchange trading in Huon would cease as of Wednesday night, with the shares to be delisted altogether in a few weeks time.
Shareholders vote in favour of JBS’ Huon takeover
October 29: Brazilian meat processing giant JBS is set to acquire Huon Aquaculture, after a majority of the Tasmanian salmon company’s shareholders voted in favour of the takeover bid.
At a shareholder meeting on Friday morning, more than 75 per cent of votes cast supported JBS Australia’s $3.85 per share offer to acquire Huon via a scheme of arrangement.
This means the threshold was passed for the multinational to acquire 100 per cent of Huon.
99.8 per cent of shareholders voted in favour of the resolution.
Huon chairman Neil Kearney said the “overwhelming shareholder support” for the JBS takeover would “secure the future of Huon, the company’s dedicated workforce and the hundreds of Tasmanian businesses that work with us”.
“Not only is it a great outcome for shareholders, it’s the right outcome for the business,” he said. “We are delighted that shareholders have endorsed the proposed transaction and we look forward to working closely with JBS on the ownership transition.”
JBS Australia chief executive Brent Eastwood said the company was pleased with the outcome and “appreciates the overwhelmingly positive shareholder response to our offer”.
“Consistent with our acquisition track record in Australia, JBS will invest in the Huon business, its people and farming practices to support long term sustainable growth,” Mr Eastwood said.
“Acquiring Huon represents our first step into the aquaculture industry for JBS globally. We believe that our contacts and our ability to open up and access new markets, combined with the expert team at Huon, create a fantastic opportunity to take this business forward.
“We will uphold the highest standards for superior quality, fish health and sustainable farming practices – from water management to animal welfare, and stock densities.”
Since launching its takeover bid, JBS has faced significant criticism from environmentalists and anti-salmon farming campaigners, who say the company has a poor track record on animal welfare and the environment.
Mining magnate Andrew ‘Twiggy’ Forrest’s private investment company Tattarang increased its stake in Huon to 18.51 per cent in August this year, making it the second-largest shareholder. Despite speculation that Dr Forrest could launch a rival takeover bid, a counter-offer never eventuated and Tattarang ended up backing JBS’s bid.
On Wednesday, Dr Forrest called on JBS S.A, the parent company of JBS Australia, to unequivocally declare its commitment to animal welfare and environmental sustainability.
This prompted JBS S.A. to issue a statement, saying it “unequivocally supports the principle of ‘no pain, no fear’ animal welfare across its global operations”.
The scheme of arrangement is still subject to Federal Court approval. A hearing has been scheduled for Wednesday, November 3.
Fish farm critics say Twiggy’s salmon plans a game-changer
PLANS revealed by Andrew “Twiggy” Forrest for a new land-based aquaculture facility have been labelled as a game-changer by staunch critics of Tasmania’s sea-based salmon industry.
Dr Forrest said his company Tattarang would commit to developing the new land-based facility, with project scoping and feasibility studies having already commenced.
The investment, anticipated to be more than $100m, has been described by Tasmanian Alliance for Marine Protection’s Peter George as sounding “the death knell of the highly-destructive sea-based Tasmanian salmon industry”.
“Unless Tasmania’s salmon industry starts an immediate transition to land-based production, their environmentally destructive sea-based methods will doom their very future—and the Tasmanian jobs that go with it,” Mr George said.
“That means out of the sea and onto land now. Anything less will risk Dr Forrest’s clean, green fish being heavily marketed against Tasmania’s dirty salmon with the irreparable brand damage to Tasmania that will ensue.”
Man-Booker prize-winning author Richard Flanagan, who took aim at the Tasmanian aquaculture industry in his book “Toxic: the Rotting Underbelly of the Tasmanian Salmon Industry”, also welcomed Dr Forrest’s announcement.
“While the devil is in the detail this would appear to be the beginning of the end for Tasmania’s dirty and destructive sea-based salmon farming industry,’’ Mr Flanagan said.
“It is in accord with what the Tasmanian community has consistently asked for: land-based fin fish farming.”
Dr Forrest said the new land-based facility would provide consumers choice to support products produced sustainably and without impacting the environment.
It comes as Dr Forrest put the heat on the new owners to declare their commitment to animal welfare and environmental sustainability.
JBS is set to take control of the Tasmanian salmon company on Friday, after the Foreign Investment Review Board ticked off on the move on Monday.
Dr Forrest said his company would not vote in favour of the takeover unless the global parent company of JBS Australia, JBS S.A, made that commitment.
“My message to these massive protein producers remains clear: your animals deserve NPNF (no pain, no fear) in their life cycle, and your customers expect you to change the management of your business to accommodate this,’’ he said.
“Only a clear commitment by JBS S.A in respect to its global operations would give Tattarang sufficient confidence to reconsider its position.”
JBS Australia chief executive Brent Eastwood said the company “unequivocally supports the principle of ‘no pain, no fear’ animal welfare across its global operations”.
“As detailed in the scheme booklet, JBS S.A. has an uncompromising global commitment to sustainability and animal welfare,’’ Mr Eastwood said.
“This commitment extends to Huon, where JBS intends to build on the company’s strong foundations and uphold the highest standards of fish health and sustainable farming practices, from water management to animal welfare, net zero emissions and stocking densities.”
EARLIER:
BRAZILIAN meat giant JBS is set to take control of controversial Tasmanian salmon company Huon Aquaculture this Friday.
On Monday, the takeover bid overcame its biggest hurdle – approval from the Foreign Investment Review Board, which advises federal treasurer Josh Frydenberg on foreign takeovers of Australian assets.
FIRB confirmed it did not object to the $500 million acquisition, a sale that will deliver an expected personal windfall to founders Francis and Peter Bender of more than $200 million.
Shareholders will vote on the buy-up at the agreed rate of $3.85 per share this Friday.
Environmentalists, and the likes of Western Australian mining magnate Andrew “Twiggy” Forrest, have denounced the sale, criticising JBS’ environmental record.
“This is truly bleak news for Tasmania,” Neighbours of Fish Farms president Peter George said.
“All Tasmanians should be deeply concerned that a multinational with a global reputation for corruption is taking over Tasmania’s second biggest salmon producer.
“JBS has a track record for animal cruelty and environmental destruction.”
Shadforth Financial Group private wealth adviser Sam Baker said Western Australian mining magnate Andrew “Twiggy” Forrest would be forced to give up his 18.5 per cent stake in the company if a 75 per cent threshold was met by shareholders this week.
If that threshold isn’t met, JBS will still take effective control of the company, but Mr Forrest would be able to remain a minority shareholder without voting power.
“It is possible for him to potentially hold onto his share in Huon but the reality is JBS will take control of Huon Aquaculture,” he said.
“The only other thing is if Andrew Forrest tries to make a spirited takeover. I think that’s very unlikely at this point.
“The most significant hurdle for the takeover was the Foreign Investment Review Board approval. That hurdle has now been cleared and it paves the way for the takeover to proceed on Friday.”
Mr Forrest had increased his company holdings from 4 per cent to 18.5 per cent amid the takeover talk, promising to keep an eye on the company’s environmental behaviour.
Huon Aquaculture said the Benders, who own 52 per cent of the company and will vote in favour of the takeover, “strongly supported” the sale.
The company has also praised JBS.
“In addition to a commitment to invest in the business and our 800-strong team, JBS has committed to maintaining our world-leading farming practices to support long-term sustainable growth,” a Huon Aquaculture spokesperson told the Mercury.
“Huon has established the highest standards of animal husbandry, biosecurity, environmental management, and sustainable farming practices and JBS will continue this uncompromising approach. Importantly, JBS also has the proven skills and expertise to access new international markets for our premium Tasmanian salmon.”
The takeover – and salmon farming in Tasmania more generally – has also been strongly condemned by high profile activists such as Man Booker-prize-winning author Richard Flanagan and art curator Kirsha Kaechele, the wife of Mona owner David Walsh.
More Coverage
Barefoot interstate tourist fails Cradle Mountain climb attempt
A walker who attempted to climb Cradle Mountain barefoot has been assisted to safety after reporting he was unable to walk. The details.
Everybody appearing at Hobart Magistrates Court, Friday, October 11
Here is a list of people appearing at Hobart Magistrates Court on October 11.