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Brazil's JBS to hold first board meeting after scandal

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Brazil's JBS SA, the world's largest meatpacker, will hold on Friday its first board meeting since its owners admitted to bribing scores of politicians, two sources with knowledge of the matter said on Thursday.

[RIO DE JANEIRO] Brazil's JBS SA, the world's largest meatpacker, will hold on Friday its first board meeting since its owners admitted to bribing scores of politicians, two sources with knowledge of the matter said on Thursday.

The plea-bargain testimony of JBS executives, including brothers Joesley and Wesley Batista, chairman and chief Executive officer respectively, was made public last week and sparked a political crisis that threatens to topple Brazilian President Michel Temer.

The Batistas face criticism from minority shareholders who demand that they resign from their posts, said one of the sources, who asked for anonymity to speak freely.

JBS has faced criticism from Brazilian consumers and its shares are down 13.6 per cent since the release of the Batistas' plea deal depositions to prosecutors.

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The stock spiked on Thursday on speculation over its strategy for weathering the fallout from the corruption scandal.

"The company has been facing a backlash and it's advisable the brothers leave the company", said the source, who is close to the shareholders' discussions.

Joesley resigned last Tuesday from his board post at Alpargatas SA, maker of Havaianas flip flops.

The company is controlled by the Batista's holding company J&F Investimentos, which is negotiating a leniency agreement with Brazilian prosecutors. J&F's proposal to pay a US$1.2 billion fine was rejected by the prosecutors' office on Wednesday. In the board meeting, representatives of shareholders will insist that JBS should not be responsible for bearing the burden of the fine.

"Minority shareholders won't fetch the bill for something they didn't do", the source added.

Brazil's development bank BNDES, whose investment arm BNDESPar is the second largest JBS shareholder, said it is analyzing possible measures related to the Batistas. Press representatives for JBS declined to comment.

REUTERS

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