Report: Sara Lee Pursued by JBS

Maybe it was Sara Lee’s November acquisition of a Brazilian coffee business that caught JBS SA’s eye.

The Wall Street Journal reported Dec. 20 that Brazilian meat-processing giant JBS SA is pursuing a takeover of Sara Lee Corp., Downers Grove, Ill. JBS reportedly approached Sara Lee, “and the talks have been on and off over several months [but] in recent weeks Sara Lee has been considering JBS's offer more seriously,” the paper said, citing “people familiar with the matter.”

JBS posted a no comment on its web site about “recent speculation in the press regarding a possible acquisition in North America.” Sara Lee didn’t even have that. Both companies are public.

Sara Lee, founded in 1939, has been restructuring itself, selling off nonfood brands and, with the pending sale of its bakery unit to Grupo Bimbo, focusing on coffee and meat processing. It now carries a market capitalization of $11 billion, the Journal reported, after the stock jumped 5.3 percent (to $17.26) on Dec. 17 following the Journal’s first report of the discussions.

JBS has a market capitalization nearly equal to Sara Lee, which could make it challenging to finance a full takeover offer, the paper speculated.

Sara Lee has been run by a three-man “office of the chairman” since Chairman and CEO Brenda Barnes resigned in August, months after suffering a stroke. While the search for a successor officially remains under way, the Journal also quoted its sources as saying the recruitment “has been delayed as it decides what to do next.”JBS entered the U.S.  market with its 2007 acquisition of Swift & Co., and in 2009 bought a 64 percent stake (now 67 percent) in Pilgrim’s Pride to help that poultry firm out of bankruptcy.

JBS entered the U.S.  market with its 2007 acquisition of Swift & Co., and in 2009 bought a 64 percent stake (now 67 percent) in Pilgrim’s Pride to help that poultry firm out of bankruptcy.

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