Obbligazione Marfrig Global Foods S.A. 3.95% ( USG5825AAC65 ) in USD

Emittente Marfrig Global Foods S.A.
Prezzo di mercato refresh price now   100 USD  ▲ 
Paese  Brasile
Codice isin  USG5825AAC65 ( in USD )
Tasso d'interesse 3.95% per anno ( pagato 2 volte l'anno)
Scadenza 28/01/2031



Prospetto opuscolo dell'obbligazione Marfrig Global Foods USG5825AAC65 en USD 3.95%, scadenza 28/01/2031


Importo minimo 200 000 USD
Importo totale 1 500 000 000 USD
Cusip G5825AAC6
Standard & Poor's ( S&P ) rating BB ( Non-investment grade speculative )
Moody's rating N/A
Coupon successivo 29/07/2026 ( In 171 giorni )
Descrizione dettagliata Marfrig Global Foods è una multinazionale brasiliana leader nel settore della produzione e commercializzazione di carne bovina, suina e di pollo, con attività in diversi paesi del mondo.

The Obbligazione issued by Marfrig Global Foods S.A. ( Brazil ) , in USD, with the ISIN code USG5825AAC65, pays a coupon of 3.95% per year.
The coupons are paid 2 times per year and the Obbligazione maturity is 28/01/2031
The Obbligazione issued by Marfrig Global Foods S.A. ( Brazil ) , in USD, with the ISIN code USG5825AAC65, was rated BB ( Non-investment grade speculative ) by Standard & Poor's ( S&P ) credit rating agency.







OFFERING MEMORANDUM



MARB BondCo PLC
(a public limited company organized and existing under the laws of England and Wales)
U.S.$1,500,000,000 3.950% Senior Notes due 2031
Unconditionally and Irrevocably Guaranteed by
Marfrig Global Foods S.A., Marfrig Holdings (Europe) B.V., Marfrig Overseas Limited
and NBM US Holdings, Inc.
We are offering U.S.$1,500,000,000 aggregate principal amount of MARB BondCo PLC 3.950% Senior Notes due 2031
(the "notes"). MARB BondCo PLC is an indirect, wholly-owned subsidiary of Marfrig (as defined below), and a public limited
company organized and existing under the laws of England and Wales. The notes are unconditionally and irrevocably guaranteed
by Marfrig Global Foods S.A., a sociedade por ações incorporated under the laws of the Federative Republic of Brazil (referred to
as "Marfrig," the "Company" or "we"). The notes are also unconditionally and irrevocably guaranteed by Marfrig Holdings
(Europe) B.V. a private limited liability company incorporated and existing under the laws of The Netherlands, Marfrig Overseas
Limited, an exempted limited liability company incorporated under the laws of the Cayman Islands and NBM US Holdings, Inc.,
a corporation incorporated under the laws of the State of Delaware (collectively referred to as the "subsidiary guarantors").
We will pay interest on the notes semi-annually on January 29 and July 29 of each year, commencing on July 29, 2021. The
notes will mature on January 29, 2031. We may redeem some or all of the notes on or after January 29, 2026 at the redemption
prices set forth in this offering memorandum. Prior to January 29, 2026 we may, at our option, redeem the Notes, in whole at any
time or in part from time to time, at the redemption prices set forth in this Offering Memorandum. There is no sinking fund for the
notes. See "Description of the Notes--Optional Redemption."
The notes will be unsecured senior obligations and will rank pari passu with all unsecured and unsubordinated obligations
of the Issuer. The guarantees of the notes will be senior unsecured obligations of Marfrig and the subsidiary guarantors and will
rank pari passu with all unsecured and unsubordinated obligations of Marfrig and the subsidiary guarantors. For a more detailed
description of the notes, see "Description of the Notes."
We intend to use the net proceeds from this offering to fund the tender offers, as described further under "Use of Proceeds."
We intend to make an application to admit the notes to listing on the official list of the Luxembourg Stock Exchange and to
trading on the Euro MTF market.
Investing in the notes involves risks. See "Risk Factors" beginning on page 19.
Price: 100%
plus accrued interest, if any, from January 29, 2021.
Delivery of the notes in book-entry form will be made on or about January 29, 2021.
The notes have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act").
The notes will be offered to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the
Securities Act ("Rule 144A") and to certain non-U.S. persons in reliance on Regulation S under the Securities Act ("Regulation
S"). You are hereby notified that sellers of the notes may be relying on the exemption from the provisions of Section 5 of the
Securities Act provided by Rule 144A. For more information on transfer of the notes, see "Transfer Restrictions."
This offering memorandum constitutes a prospectus for purposes of Part IV of the Luxembourg law on prospectuses for
securities dated July 16, 2019.
Global Coordinators & Joint Bookrunners
BNP PARIBAS
Bradesco BBI HSBC Jefferies
J.P. Morgan
Santander

Joint Bookrunners

Safra
BTG Pactual
Itaú BBA
Rabo Securities
UBS
Investment
Bank


The date of this offering memorandum is March 25, 2021.




__________
TABLE OF CONTENTS
Page
Page

Forward-Looking Statements ............................... iii Business ............................................................... 87
Presentation of Financial and Other
Management ...................................................... 124
Information ..........................................................v Principal Shareholders ....................................... 138
Summary ................................................................1 Related Party Transactions ................................ 139
Summary of the Offering .....................................10 Description of the Notes .................................... 140
Summary Financial and Other Information .........14 Taxation ............................................................. 186
Risk Factors .........................................................19 ERISA and Certain Other Considerations ......... 194
Use of Proceeds ...................................................34 Transfer Restrictions ......................................... 196
Capitalization .......................................................35 Plan of Distribution ........................................... 199
Selected Financial Information ............................36 Validity of Notes ............................................... 208
Management's Discussion and Analysis of
Independent Auditors ........................................ 209
Financial Condition and Results of
Enforcement of Judgments and Service of
Operations .........................................................40
Process ............................................................ 210
Industry Overview ...............................................70 Listing and General Information ....................... 213
Discontinued Operations ......................................80 Index to Financial Statements ............................... 1
The Issuer .............................................................82
The Guarantors ....................................................83
__________
We are responsible for information contained in this offering memorandum. We have not
authorized anyone to give you any other information, and we take no responsibility for any other
information that others may give you. Neither we, nor the Issuer, nor BNP Paribas Securities Corp.,
Banco Bradesco BBI S.A., HSBC Securities (USA) Inc., Jefferies LLC, J.P. Morgan Securities LLC,
Santander Investment Securities Inc., Banco BTG Pactual S.A. ­ Cayman Branch, Banco Safra S.A.,
acting through its Cayman Islands Branch, Itau BBA USA Securities, Inc., Rabo Securities USA,
Inc. and UBS Securities LLC referred to in this offering memorandum as the initial purchasers,
have authorized anyone to provide you with information different from, or additional to, that
contained in this offering memorandum. This offering memorandum may only be used and the notes
are being offered, and offers to purchase the notes are being sought, only in jurisdictions where
offers and sales are permitted. The information contained in this offering memorandum is accurate
only as of the date of this offering memorandum, regardless of the time of delivery of this offering
memorandum or of any sale of the notes.
In this offering memorandum, references to "Marfrig," the "Company," "we," "us" and "our" are to
Marfrig Global Foods S.A., a corporation (sociedade por ações) incorporated under the laws of the
Federative Republic of Brazil, which is a guarantor of the notes, together with its direct and indirect
subsidiaries, except where the context requires otherwise. All references to "MARB" or the "Issuer" are
to MARB BondCo PLC, an indirect, wholly-owned subsidiary of Marfrig, a public limited company
organized and existing under the laws of England and Wales, and the issuer of the notes. All references to
"subsidiary guarantors" are to Marfrig Holdings (Europe) B.V. ("Marfrig Holdings"), a wholly-owned
subsidiary of Marfrig, incorporated and existing under the laws of The Netherlands as a private limited
liability company, Marfrig Overseas Limited ("Marfrig Overseas"), an exempted limited liability company
incorporated under the laws of the Cayman Islands and NBM US Holdings Inc. ("NBM"), a corporation
incorporated under the laws of the State of Delaware. Al references to the "guarantors" are to Marfrig,
Marfrig Holdings, Marfrig Overseas, and NBM. The guarantees of the notes are unconditional (subject to
any limitations on such guarantees by virtue of applicable local law). When used in this offering
memorandum, the term "Marfrig Group" or the "Group" refer to Marfrig together with its subsidiaries,
i



taken as a whole. References to "controlling shareholder" are to MMS Participações Ltda. ("MMS
Participações"). Marcos Antonio Molina dos Santos and Marcia Aparecida Pascoal Marçal dos Santos
collectively hold all of the voting stock of MMS Participações and together hold, directly and indirectly,
47.60% of our voting stock as of September 30, 2020. References to "principal shareholders" refer to
persons who own 5.0% or more of our capital stock.
When used in this offering memorandum, the term "domestic markets" refers to the internal markets
of each of the 5 countries in which we operate, and the term "export markets" refers to the international
markets to which we export our final products from such domestic markets as final destinations.
The term "Brazil" refers to the Federative Republic of Brazil. The term "Brazilian government" refers
to the federal government of Brazil, and the term "Central Bank" refers to the Central Bank of Brazil
(Banco Central do Brasil).
All references in this offering memorandum to "real," "reais" or "R$" are to the legal currency of
Brazil, and all references to "U.S. dollar," "U.S. dollars" or "U.S.$" are to the legal currency of the United
States of America. This offering memorandum contains translations of various real amounts into U.S.
dollars at specified rates solely for your convenience. You should not construe these translations as
representations by us that the real amounts actually represent these U.S. dollar amounts have been or could
be converted into U.S. dollars at the rates indicated or at any other rates. Unless otherwise indicated, we
have translated the real amounts using a rate of R$5.6401 to U.S.$1.00, the U.S. dollar selling rate as of
September 30, 2020, as reported by the Central Bank.
__________
Neither the SEC nor any state securities commission nor any other regulatory authority has approved
or disapproved the offering of the notes nor has any of the foregoing authorities passed on or endorsed the
merits of the offering or the accuracy or adequacy of this offering memorandum. Any representation to
the contrary is a criminal offense.
We are relying on exemptions from registration under the Securities Act for offers and sales of
securities that do not involve a public offering in the United States. The notes offered through this
offering memorandum are subject to restrictions on transferability and resale, and may not be transferred
or resold in the United States, except as permitted under the Securities Act and applicable U.S. state
securities laws pursuant to registration or exemption from them. By purchasing the notes, you will be
deemed to have made the acknowledgments, representations, warranties and agreements described
under the heading "Transfer Restrictions" in this offering memorandum. You should be aware that you
may be required to bear the financial risks of this investment for an indefinite period of time. In making
investment decisions, you must rely on your own examination of our business and the terms of the
offering, including the merits and risks involved.
You must comply with all applicable laws and regulations in force in any jurisdiction in which you
purchase, offer or sell the notes or possess or distribute this offering memorandum and must obtain any
consent, approval or permission required for your purchase, offer or sale of the notes or common shares
issuable on conversion of the notes under the laws and regulations in force in any jurisdiction to which
you are subject or in which you make such purchases, offers or sales. Neither we nor the initial purchasers
will have any responsibility therefor.
We and the initial purchasers reserve the right to reject, in whole or part, and for any reason, any
offer to purchase notes offered hereby. We and the initial purchasers also reserve the right to sell or place
less than all of notes offered hereby.
No representation or warranty, express or implied, is made by the initial purchasers or their respective
affiliates as to the accuracy or completeness of any of the information set out in this offering memorandum.
Nothing contained in this offering memorandum is or shall be relied upon as a promise or representation
by the initial purchasers, whether as to the past or to the future.
____________________
ii



FORWARD-LOOKING STATEMENTS
This offering memorandum contains estimates and forward-looking statements, principally in the
sections "Summary," "Risk Factors," "Management's Discussion and Analysis of Financial Condition and
Results of Operations," and "Business." Our estimates and forward-looking statements are based on our
current expectations and projections of future events and trends, which affect or may affect our businesses
and results of operations. Words such as "believe," "anticipate," "seek," "expect," "estimate," "will,"
"plan," "may," "could," "intend," "predict," "project" and other similar words are used in this offering
memorandum to identify forward-looking statements.
Although we believe that these estimates and forward-looking statements are based upon reasonable
assumptions, they are subject to several risks and uncertainties and are made in light of information
currently available to us. Many important factors, in addition to the ones discussed in this offering
memorandum, may adversely affect our profitability, financial condition and results of operations,
including, but not limited to, the following:
·
fluctuations in commodity prices and in the availability of raw materials, especially live cattle
and other resources, could negatively impact our profitability, financial condition and results of
operations;
·
changes in market prices, customer preferences and competitive conditions;
·
impacts of, and associated responses to, the novel coronavirus ("COVID-19") pandemic;
·
the outbreak of disease affecting animals;
·
the adoption of sanitary regulations in domestic markets;
·
Marfrig's ability to keep a high degree of customer satisfaction;
·
Marfrig's ability to develop innovative products and concepts and to implement its products
within defined timelines;
·
government interventions resulting from changes in economic conditions, in taxes or the
regulatory frameworks of the United States, Brazil and the other countries in which Marfrig
operates;
·
the macroeconomic conditions and the political, social and business conditions in the United
States, Brazil and other countries in which Marfrig operates;
·
the adoption of tariffs, trade barriers, sanitary regulations or other import restrictions by
countries to which Marfrig exports or plans to export its products;
·
developments in, or changes to, the tax, social security, labor and environmental laws and
regulations, including the regulatory framework, which could make Marfrig's business model
or products less attractive;
·
the conditions of infrastructure in countries in which Marfrig operates;
·
fluctuations of the real against the U.S. dollar and the other currencies in the countries in which
Marfrig operates;
·
Marfrig's ability to integrate the operations of acquired assets with its ongoing business;
·
Marfrig's ability to compete successfully;
·
Marfrig's ability to implement its business strategy, including its financial strategy and
investment plan;
·
Marfrig's ability to obtain financing when necessary and on favorable terms;
·
developments in, or changes to, international laws and regulations, including with respect to
health or food safety;
iii



·
unfavorable findings in judicial or administrative proceedings to which we are a party;
·
adverse weather conditions and natural disasters that may affect our supply chain, facilities or
markets in which we operate or to which we export;
·
liabilities or other issues relating to the sale of Marfrig's assets or subsidiaries;
·
cybersecurity attacks or issues, including the theft of customer or supplier information;
·
Marfrig's ability to execute its expansion plans, and to fund the costs and capital expenditures
related to these plans;
·
Marfrig's level of debt and other financial obligations and ability to refinance its debt;
·
anti-corruption investigations involving Marfrig's chairman and controlling shareholder, or
other directors, officers or employees, which could materially or adversely affect Marfrig's
public perception and/or reputation, business or financial condition;
·
other factors or trends affecting Marfrig's liquidity, financial condition and results of operations;
and
·
the factors discussed in the section "Risk Factors" of this offering memorandum.
Estimates and forward-looking statements involve risks and uncertainties and are not guarantees of
future performance. Our future results may differ materially from those expressed in the estimates and
forward-looking statements. In light of these risks and uncertainties, the estimates and forward-looking
statements discussed in this offering memorandum might not occur and our future results and performance
may differ materially from those expressed in the forward-looking statements, or from our past results and
performance, due to the aforementioned or other factors. Because of these risks and uncertainties, you
should not make any investment decision based on the estimates and forward-looking statements. The
forward-looking statements included in this offering memorandum are made only as of the date of this
offering memorandum, and neither we nor the initial purchasers undertake any obligation to update or to
revise this information.
iv



PRESENTATION OF FINANCIAL AND OTHER INFORMATION
Financial Information
We prepare our financial statements in accordance with accounting practices adopted in Brazil, which
are based on:
·
Brazilian corporate law (Law No. 6,404, dated December 15, 1976, as amended, including the
provisions of Law No. 11,638, dated December 28, 2007, Law No. 11,941, dated May 27, 2009
and Law No. 12,431, dated June 24, 2011) ("Brazilian Corporate Law");
·
accounting pronouncements issued by the Accounting Pronouncements Committee (Comitê de
Pronunciamentos Contábeis, or the "CPC"); and
·
as we are a public company in Brazil, rules and regulations issued by the Brazilian security and
exchange commission (Comissão de Valores Mobiliários, or the "CVM").
We refer to these accounting practices as "Brazilian GAAP." Brazilian GAAP has changed in recent
years to converge with International Financial Reporting Standards, International Accounting Standards
and Interpretations ("IFRS") as issued by the International Accounting Standards Board ("IASB"). Our
consolidated financial statements as of and for the nine-month periods ended September 30, 2020 and
2019, and as of and for the years ended December 31, 2019 and 2018 were prepared in accordance with
IFRS and Brazilian GAAP.
This offering memorandum contains unaudited consolidated interim financial statements as of and
for the nine-month period ended September 30, 2020 and the notes thereto, which have been reviewed,
but have not been audited, by Grant Thornton Auditores Independentes and contains the review report of
Grant Thornton Auditores Independentes with respect thereto. The financial statements as of and for the
nine-month period ended September 30, 2020 also contain comparative information as of and for the nine-
month period ended September 30, 2019 which is derived from our unaudited consolidated interim
financial statements as of and for the nine-month period ended September 30, 2019, which are not
contained in this offering memorandum. This offering memorandum also contains our financial
information derived from our audited consolidated and individual financial statements as of and for the
years ended December 31, 2019 and 2018 (which contain comparative information for the financial year
ended December 31, 2018 and 2017, respectively), and the notes thereto, and contains the audit report of
Grant Thornton Auditores Independentes with respect thereto. See below for further discussion. Our
consolidated financial statements include both guarantor and non-guarantor companies.
In accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations ("IFRS
5"), in periods where we have either disposed of, or classified for sale, an operation, we are also required
to disclose in the current period those operations' results as discontinued operations. When such conditions
exist, we are required to present the results of operations of discontinued businesses and any gain on sale
of a discontinued businesses as a single amount in our statement of income separate from our continuing
operations for the current period, to present the comparative period results of operations on a similar basis
and to present any assets held for sale separately in our consolidated balance sheet in the period in which
the transaction occurs. During the year ended December 31, 2018, we disposed of the Keystone Foods
("Keystone") business, as described in more detail below, and our audited consolidated financial
statements as of and for the year ended December 31, 2018 include the required disclosure of the results
of operations of the discontinued business.
On November 30, 2018, we sold to Tyson Foods, Inc. ("Tyson") our entire ownership interest in
certain Marfrig subsidiaries that own and operate the Keystone business unit. The total consideration for
the sale was U.S.$2.4 billion, and the amount received by Marfrig after contractual adjustments, such as
the exclusion of Keystone's net debt, was U.S.$1.4 billion, which remains subject to purchase price
adjustments. See "Discontinued Operations."
On June 5, 2018, we acquired a 51% controlling interest in National Beef Packing Company, LLC
("National Beef") from Jefferies Financial Group Inc. ("Jefferies") and other shareholders for
v



R$3.7 billion. See note 12.2 to our audited consolidated financial statements as of and for the year ended
December 31, 2018. On November 29, 2019, we acquired an additional 31.1715% interest in National
Beef for an amount in cash equal to U.S.$860,000,000 plus all applicable accrued but unpaid distributions,
which amounted to an aggregate consideration of U.S.$970,000,000 that was partially financed by external
sources, bringing our interest from 51% to 81.73%. See note 11.2.3 to our audited consolidated financial
statements as of and for the year ended December 31, 2019.
Our audited consolidated statements of income and cash flow for the year ended December 31, 2018
(i) include the results of the National Beef business only from the date of acquisition on June 5, 2018 and
(ii) exclude the results of operations of the Keystone business, reflecting their status as discontinued
operations (the "Discontinued Operations"). Our consolidated statement of financial position, consolidated
statement of changes in shareholders' equity and consolidated statement of added value as of December
31, 2018 exclude Discontinued Operations.
Unless otherwise indicated, all financial data contained in this offering memorandum are presented
on the basis of continuing operations only.
Adjusted EBITDA
Marfrig's earnings before interest, taxation, depreciation and amortization ("Adjusted EBITDA")
consists of net income (loss) adjusted by net financial income (expenses), income taxes and social
contribution, equity in earnings (losses) of subsidiaries, other operating income (expenses) and
depreciation and amortization. Adjusted EBITDA (continuing operations) excludes the financial results of
assets classified as discontinued operations for the periods indicated. For the year ended December 31,
2018, Adjusted EBITDA (continuing operations) includes the gain on sale of discontinued operations of
R$3,445 million after tax, in accordance with IFRS 5.
For a reconciliation of Adjusted EBITDA (continuing operations) to net income, see "Selected
Financial Information--Adjusted EBITDA Reconciliation." We use Adjusted EBITDA as an additional
measure to monitor our operating and economic performance. Adjusted EBITDA is not a measure
recognized under Brazilian GAAP, IFRS or U.S. GAAP and should not be considered individually as an
alternative to net income, as a measure of operating performance, as an alternative to cash flow or as a
measure of liquidity. Other companies may calculate Adjusted EBITDA in a manner that is different from
ours. We publish Adjusted EBITDA because we use it as a measure of performance, and we consider
Adjusted EBITDA a useful measure because it is frequently used by capital markets analysts, investors
and other parties interested in evaluating companies in our industry. Because Adjusted EBITDA does not
reflect financial revenues or expenses, taxes, social contribution tax or depreciation and amortization, it is
an indicator of our general financial performance, which is not affected by changes in interest rates, debt,
taxes, social contribution tax rates or rates of depreciation and amortization. As a result, we believe that
Adjusted EBITDA is a useful tool to compare our operating performance in different periods, and as a
basis for certain management decisions. In addition to our general financial performance, we believe that
Adjusted EBITDA also enables us to better understand our ability to discharge our liabilities and to finance
our capital expenses and working capital. However, the usefulness of Adjusted EBITDA as a measure of
profitability is limited, since it does not reflect a number of the costs and expenses involved in doing
business, such as financial expenses, taxes, depreciation, capital expenses and other related costs, any of
which may have a significant effect on our net income.
Rounding
Certain amounts and percentages included in this offering memorandum have been rounded to
facilitate their presentation. The totals presented in certain tables therefore may not be exactly the sum of
the preceding amounts.
vi



Convenience Translations into U.S. Dollars
Certain Brazilian real amounts included in this offering memorandum have been translated, solely
for the purposes of convenience for the reader, into U.S. dollars at the exchange rate as of September 30,
2020 of R$5.6401 to U.S.$1.00. Where those amounts have been translated, the relevant figures have been
annotated.
Market Information
We have obtained the market and competitive position data, including market forecasts, used
throughout this offering memorandum from internal surveys, market research, publicly available
information and industry publications. We include data from reports prepared by us; the United States
Department of Agriculture (the "USDA"); the Brazilian Ministry of Agriculture, Livestock and Supply
(Ministério da Agricultura, Pecuária e Abastecimento, or "MAPA"); the Brazilian Ministry of Labor and
Employment (Ministério do Trabalho e Emprego, or "MTE"); Dom Cabral Foundation (Fundação Dom
Cabral), an educational institution located in the city of Belo Horizonte, state of Minas Gerais, in the city
of Nova Lima, state of Minas Gerais, and in the city of São Paulo, state of São Paulo; the Brazilian Institute
of Geography and Statistics (Instituto Brasileiro de Geografia e Estatística, or the "IBGE"); School of
Agriculture Luiz de Queiroz (Escola Superior de Agricultura Luiz de Queiroz, or the "ESALQ"); the
International Monetary Fund ("IMF"); and the Food and Agriculture Organization of the United Nations
(the "FAO"), among others. Industry publications, including the ones referred to in this offering
memorandum, generally state that the information presented in that publication has been obtained from
sources believed to be reliable, but that the accuracy and completeness of the information is not guaranteed.
Similarly, internal surveys, industry forecasts and market research, while we believe to be reliable, have
not been independently verified, and neither we nor the initial purchasers make any representation as to
the accuracy of the information. Information from third parties has been accurately reproduced and as far
as we are aware and are able to ascertain from information published by that third party, no facts have
been omitted which would render the reproduced information inaccurate or misleading.
Operational Information
Unless otherwise indicated, all production, plant and capacity data contained in this offering
memorandum are presented on the basis of continuing operations only, which includes the National Beef
business, but excludes the Keystone business.
Covenant Net Debt
This offering memorandum contains information with respect to our net debt as adjusted to take into
account the difference in the value in reais of our foreign currency denominated debt as of the date of the
incurrence of such debt (using the then current exchange rate) and as of the last day of the most recent
financial statements available ("Covenant Net Debt"). Covenant Net Debt is calculated pursuant to the
terms of our financing agreements for the purposes of compliance with certain financial covenants therein,
including Covenant Net Debt/EBITDA ratio. See note 17.2 to our unaudited consolidated financial
statements as of and for the nine-month period ended September 30, 2020, "--EBITDA" and "Selected
Financial Information--EBITDA Reconciliation."
vii




SUMMARY
We present below a summary of our activities, financial and operating information, strengths and
strategies. Before investing in the notes, potential investors should carefully read this entire offering
memorandum to best understand our business and the offering, including our financial statements and related
notes, as well as the sections "Risk Factors," "Summary of Financial and Other Information," "Selected
Financial Information" and "Management's Discussion and Analysis of Financial Condition and Results of
Operations." Some of the statements in this summary constitute forward-looking statements. See "Forward-
Looking Statements."
Introduction
We are a multinational corporation and the world's second largest beef company in terms of production
capacity. As of September 30, 2020, we operated 20 slaughter plants and 12 processed food plants across
North America and South America. Our activities include the production, processing, sale and distribution of
foods made from animal protein, primarily beef, as well as a variety of other food products, such as frozen
vegetables, lamb, pork, fish, sauces and desserts.
For the nine-month period ended September 30, 2020, approximately 74% of our revenue came from our
North America business and 26% came from our South America business. In South America approximately
11% of our revenue originates from sales of processed products such as canned meat, hamburgers and
vegetables.
With approximately 32,000 employees, we operate in the food service, retail and wholesale channels,
offering innovative, safe and healthy choices. We have a diversified and comprehensive portfolio of products
that can be found in major restaurant and supermarket chains and that reach millions of individual customers
in approximately 100 countries.
As of September 30, 2020, we had a daily slaughtering capacity of 30,100 head of cattle and 6,500 lambs.
Together, this production platform gives us important geographic diversity which mitigates fluctuations in the
cattle cycle given the spread of our production over many countries in the Americas as well as the ability to
hedge against certain industry risks.
On June 5, 2018, we acquired a 51% controlling interest in National Beef from Jefferies and other
shareholders for R$3.7 billion. On November 29, 2019, we acquired an additional 31.1715% interest in
National Beef for an aggregate consideration of U.S.$970,000,000, bringing our interest from 51% to 81.73%.
See note 11.2.3 to our audited consolidated financial statements as of and for the year ended December 31,
2019. On November 30, 2018, we sold to Tyson, for consideration of U.S.$2.4 billion (subject to purchase
price adjustments), our entire ownership interest in our subsidiaries that owned and operated the Keystone
business unit. See "Risk Factors--Risks Relating to Our Business and Industry--The corporate transactions
we engage in may adversely affect us" and "Discontinued Operations."
The strategy behind the purchase of National Beef and the sale of Keystone was to allow us to focus on
our core beef business, expand our footprint in North America, the world's largest consumer beef market, and
reduce our leverage.
Our business structure comprises two main divisions: North America and South America.
·
North America -- Our North America business consists mainly of National Beef, which is the fourth
largest beef processor in the United States. With three slaughter plants with a capacity of
approximately 13,100 head/day, National Beef represents approximately 14% of the fed steer and
heifer processing capacity in the United States. As of September 30, 2020, the North America
business also had a production capacity of approximately 120,000 tons of beef patties per year and
one of the largest and most technologically advanced beef patty plants in the United States. The
North America business's products are sold domestically in the retail, wholesale, foodservice and
1





processed foods channels, and exported to various markets. It is also the United States' leading
exporter of chilled beef, with a focus on the Japanese and South Korean markets. This business also
operates a wet blue tannery, a refrigerated and livestock transportation business and an online direct-
to-consumer business offering high-quality beef and other gourmet food items for home delivery.
·
South America -- Our South America business is one of the region's leading beef producers, with
a slaughter capacity of approximately 17,000 head/day. It is recognized for its quality products and
as one of South America's main exporters. In Brazil, our business has slaughter capacity of 12,100
animals/day and the capacity to produce 77,000 tons of beef patties per year, with a focus on the
retail and foodservice channels. We are the largest producer and exporter of organic beef in the
Uruguayan industry where we focus on the production and sale of organic beef for export. In
Argentina, we own two slaughter plants, are the leading producer and seller of beef patties and own
one of the region's most valuable and most recognized brands. In Chile, we are the leading beef
importer and have a lamb slaughter plant in the Patagonia region.
In the nine-month period ended September 30, 2020, we recorded R$49,215.4 million in net sales and
R$8,985.4 million in gross profit, an increase of 42.5% and 108.6%, respectively, compared to R$34,543.2
million in net sales and R$4,308.0 million in gross profit in the nine-month period ended September 30, 2019.
In the year ended December 31, 2019, we recorded R$48,761.1 million in net sales and R$6,384.0 million in
gross profit, an increase of 64.1% and 66.2%, respectively, compared to R$29,715.2 million in net sales and
R$3,842.3 million in gross profit in the year ended December 31, 2018.
In the nine-month period ended September 30, 2020, Adjusted EBITDA amounted to R$7,487.6 million,
an increase of 137.5% from R$3,152.5 million in the nine-month period ended September 30, 2019. In the
year December 31, 2019, Adjusted EBITDA amounted to R$4,770.7 million, an increase of 83.4% from
R$2,600.6 million in the year ended December 31, 2018.
In the nine-month period ended September 30, 2020, the volume of products sold totaled 2,515.5 thousand
tons, an increase of 5.9% in comparison to the 2,375.8 thousand tons sold in the nine-month period ended
September 30, 2019. In the year ended December 31, 2019, the volume of products sold totaled 3,255.8
thousand tons, an increase of 37.3% in comparison to the 2,371.0 thousand tons sold in the year ended
December 31, 2018.
Financial Information
The tables below show certain financial information derived from our consolidated financial statements
and results of operations for the periods indicated.

For the nine-month period

ended September 30,
For the year ended December 31,


2020

2020

2019

2019

2019

2018


(U.S.$)(4)
(U.S.$)(3)(4)

(unaudited)
(R$)
(unaudited)
(R$)



(in millions, except percentages)

Net sales(1).........................................................................................
8,726.0 49,215.4
34,543.2
8,645.4
48,761.1 29,715.2
Net income (loss) in the period from continuing operations(1)(2) ..
550.9 3,107.3
1,183.4
280.5
1,582.2 (1,489.3 )
Adjusted EBITDA (continuing operations)(3) ...................................
1,327.6 7,487.6
3,152.5
845.9
4,770.7
2,600.6
Adjusted EBITDA margin (continuing operations)(3)(6) ....................
15.2%
15.2%
9.1 %
9.8 %
9.8 %
8.8 %
________________
Notes:--
(1) Net sales and net income (loss) for each period reflect the financial information of the continuing operations only.
(2) Net income refers to income attributable to Marfrig and excludes minority interest.
2