Minerva has filed a petition with Brazil’s Administrative Council for Economic Defense (CADE) challenging the approval of the merger between Marfrig and BRF. The company argues that the deal was fast-tracked by CADE’s General Superintendence, when it should have been reviewed by CADE’s Tribunal due to its potential anticompetitive effects.
According to Brazil Journal, Minerva claims the merger could disrupt market balance, as Marfrig —besides taking control of BRF, one of the country’s largest food processors— is also a major beef packer. In Minerva’s view, the resulting vertical integration would give Marfrig significant leverage over beef supplies to the processed food industry, creating an advantage that competitors could not match. Minerva argues the merger, which would create “MBRF,” would result in excessive concentration in segments such as meatballs, hamburgers and kibbeh, while expanding the new company's purchasing power and brand portfolio to 37 labels.
In its original analysis, CADE’s General Superintendence concluded that both companies would continue to operate independently and would not integrate their production or commercial activities, thus approving the deal without restrictions at the end of May. Marfrig had surpassed 50% of BRF’s share capital, becoming its controlling shareholder.
Another concern is Salic, a Saudi fund that holds a 24.5% stake in Minerva and, after the merger, would also own a 10.6% stake in MBRF. Minerva fears that Board members appointed by the Saudi sovereign fund could facilitate the exchange of strategic information and undermine rivalry in the sector. Although Minerva is controlled by the Vilela de Queiroz family holding, which owns 29% of the company, Salic is part of the controlling block and actively participates in strategic decisions. Three of Minerva’s ten Board members are appointed by Salic, which also nominates members of internal committees and has access to confidential company data.
Now, a member of CADE’s Tribunal will review Minerva’s petition and decide whether to reopen the case or uphold the previous approval.
