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Ad hoc committee opposes JBS consent solicitation for 9 3/8%, 10½% notes
By Jennifer Chiou
New York, June 22 - An ad hoc committee of holders of JBS SA's $275 million of 9 3/8% senior notes due 2011 and $300 million of 10½% senior notes due 2016 said that it is opposed to the company's consent solicitation, which is linked to the acquisition of Swift Foods Co.
The committee represents holders of more than 51% of JBS's 10½% notes.
Committee members said that they expect the company will not obtain the required consents for the notes.
The consent solicitation is scheduled to expire at 5 p.m. ET on June 26. It began on June 11.
As already announced, among other changes, the proposed amendments to the note indentures would allow JBS to designate one or more of its newly formed or acquired subsidiaries as "unrestricted." Unrestricted subsidiaries would not be subject to the covenants in the indentures that otherwise apply to JBS and its subsidiaries.
The company said in the release that the proposed changes would provide it with flexibility to obtain financing that is non-recourse to JBS and its subsidiaries in order to facilitate its acquisition of Swift Foods.
Holders who deliver consents by the expiration date will receive $2.50 per $1,000 principal amount of notes.
If the consent solicitation is completed successfully and JBS chooses to make the supplemental indentures operative, consenting noteholders will receive an additional $7.50 per $1,000 principal amount of notes.
Interested noteholders may contact the committee through counsel (Timothy B. DeSieno, Bingham McCutchen LLP, phone 212 705-7426, fax 212 508-1458 or tim.desieno@bingham.com).
Sao Paulo, Brazil-based JBS, also known as Grupo Friboi, is the fourth largest beef company in the world in terms of live cattle slaughtering capacity and the largest beef processor and exporter in Brazil and Latin America as measured by revenues.
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