July 26, 2016 Marfrig Frigorificos e Comercio de Alimentos Ltda.

Volume 4 | Issue 3

In its relatively short history, Marfrig Frigorificos e Comercio de Alimentos engineered vital acquisitions that expanded its product portfo

It only took Marfrig Frigorificos e Comercio de Alimentos S.A. less than 20 years to emerge as one of the largest international beef processing enterprises, a position achieved through a series of significant acquisitions.
Headquartered in Sao Paulo, Marfrig is now the fourth-largest bovine producer in the world and the second largest in Brazil. With processing plants in Brazil, Argentina, Chile and Uruguay, the organization prepares, packages and distributes premium beef cuts and frozen cooked parts for customers in North and South America, Asia, Africa and the Middle East. Today, about 50 percent of its sales come from exports.

RAPID EXPANSION

The Marfrig story begins in 1986, when President and Director Marcos Antonio Molina dos Santos opened his first business. Remarkably, he was only 16 years old. By the time he was 18, he had established himself as an important distributor of beef (bovine cuts), pork, foul and fish, as well as frozen imported vegetables. “He distributed these items to customers in Sao Paulo, including numerous restaurants,” recalls Sergio Mobaier, Marfrig’s marketing director.

In 2000, Molina helped establish Marfrig Frigorificos e Comercio de Alimentos S.A. Subsequently, the company built its first bovine processing plant in Bataguassu in Mato Grosso do Sul. Two years later, Marfrig opened its second plant, located in Promissao, Sao Paulo, and established its export business. The company then expanded with two significant acquisitions: the Tangara da Serra plant (in 2003) and the Paranatinga plant (in 2004), both located in Matto Grosso.

The company had a big year in 2006, as far as acquisitions. In April, it purchased a plant in the state of Goias. In July, it established the Marfrig Chile operation. In August, the company acquired plants in Rodonia, Rio Grande do Sul and Tacuarembo, Uruguay. In September, it bought 50 percent of Quinto Cuarto. In addition, Marfrig made an outright purchase of Argentina Breeders and Packers S.A. of Sante Fe, an acquisition that established its presence in that country.

WIDESPREAD OPERATIONS

Marfrig, which experienced 60 percent growth in the past year, employs more than 21,000 people, including the workers in its international operations.

Now one of the largest producers of beef and beef byproducts in Latin America, Marfig has expanded operations to include 18 packing (slaughtering and processing) plants: nine in Brazil, five in Argentina and four in Uruguay. The company also has 13 plants that produce processed and industrialized products (six in Brazil, four in Argentina, two in Uruguay and one in Chile); tree lamb packing plants (in Chile and Uruguay); four pork packing plants (Brazil), and six chicken packing plants in Brazil, having one industrialized products and three trading operations in Chile, the United States and the United Kingdom.

Marfrig also established a distribution center in Sao Paulo and a leather processing plant, also in Sao Paulo, that boasts the capacity to process 1,500 hides per day.

RECENT ACQUISITIONS

Marfrig went public in 2007. The following year, it purchased 70 percent of QuickFood, the largest producer of hamburgers in Argentina. In addition, Marfrig purchased 100 percent of the capital of Mabella, a Brazilian pork producer. The acquisition expanded Marfrig’s product portfolio for both business clients and consumers. “Ongoing portfolio expansion is one of the things that differentiates us from our competition,” comments Mobaier.

In January 2008, Marfrig purchased 100 percent of the shares of Mirab S.A. of Buenos Aires, Argentina’s leading manufacturer of meat-based snacks. The acquisition, reportedly worth $36 million, was accomplished through Marfig’s Argentinian subsidiary, Argentine Breeders and Packers S.A. Mirab exports to several countries including the United States of America, Japan and United Kingdom. In the United States, it imports, packages and distributes products through Mirab USA Inc. of Taylor, Mich., the world’s largest processor of private label beef jerky. The acquisition strengthened Marfrig’s participation in the value-added meat snacks market, making it South America’s top producer of beef jerky. In addition, it represented Marfig’s first North American investment.

In February 2008, Marfrig acquired Carrol’s Food do Brasil S.A., which specializes in production and sale of pork. Accomplished through the Marbella subsidiary, the deal was worth $25.2 million. Carrol’s, which includes a large feeding facility in Mato Grasso and two ranches, raises 160,000 hogs and produces 1,200 heads per day.

In March 2008, Marfrig acquired DaGranja Agroindustrial Ltda. and Penapaulo/Pena Branca, which are specialized in production and sale of chicken meats and their industrialized products.

CHANNELING ITS RESOURCES

Today, Marfrig seeks to address ever-changing consumer needs. “We’re always looking to insert new products into our portfolio with speed, agility and great value,” says Mobaier. “In this way, we now offer a complete line of food products, not just fresh meats.”

The company distinguishes itself from the Brazilian competition by focusing activities on the food service channel. “We provide a wide variety of products, both convenient and high-quality, and we cater to each client’s specific product needs as far as types of cuts and other elements,” explains Mobaier.

In addition, the company’s production processes and cattle choice guarantees the most tender meats. Further, with plants in several South American countries, Marfrig can easily import cuts and special brands for restaurant chains that like to offer imported meats to their customers.

The company’s philosophy has always been to take care of the clients through direct interaction and by meeting their needs with the highest quality products. In this way, the company developed trust throughout the industry that helped fuel its remarkable growth.

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