JBS forms joint venture with Indonesia fund in $2.5bn deal - Valor International

JBS, one of the world’s largest meat and food companies, announced a joint venture with Danantara Investment Management, the investment arm of Indonesia’s sovereign wealth fund, in which the fund is expected to invest $2.5 billion. Under the agreement, JBS will contribute all of its operations in Australia and New Zealand to the joint venture, while Danantara will invest the funds and receive a 25% stake in the new company.

According to a notice of material fact disclosed by JBS on Friday (7) morning, the Indonesian fund will make an initial investment of $800 million, equivalent to nearly 9.64% of the joint venture’s shares, and pay the remainder over up to three years. In addition to the equity investment, the new company is expected to raise up to $2.5 billion in additional debt, bringing total funding to as much as $5 billion.

The funds will be used to finance acquisitions, investments in new plants, including greenfield projects, and other growth initiatives in Indonesia, Australia, New Zealand, and other Southeast Asian markets.

The agreement also provides for the new company to go public through an initial public offering (IPO). If an IPO has not taken place within six years of the completion of the transaction announced Friday, Danantara will have up to two opportunities to exchange all or part of its stake in the joint venture for newly issued JBS shares.

Danantara’s investments will be deployed according to a plan that calls for the funds, during the first two years after the transaction closes, to be used “exclusively” to finance new operations and greenfield plants, acquisitions, or investments in new or existing companies in Indonesia’s protein production sector.

After that period, the remaining funds may be used for a broader range of investments and expansions, including new or existing companies in the sector across Southeast Asia, Australia, and New Zealand, as well as capital expenditures on greenfield or brownfield projects in those jurisdictions.

Danantara’s stake in the new company could be higher than 25%, reaching as much as 30%. Once the fund completes its investment in the new company, if the joint venture’s EBITDA in “2026-2027” is below its 2025 EBITDA, Danantara will be entitled to additional shares as compensation, provided its stake in the JV does not exceed 30%, according to the statement.

“Our partnership with Danantara represents an important step in our long-term growth strategy in Southeast Asia,” JBS CEO Gilberto Tomazoni said in a separate statement. “Together with Danantara, we are well-positioned to expand our presence in Indonesia and other Southeast Asian markets, strengthen regional protein supply chains, expand market access, and accelerate the development of Indonesia’s protein sector,” he added.

Southeast Asia has a large population undergoing rising incomes and urbanization, alongside increasing consumption of meat and other protein products. According to statistics from the ASEAN Secretariat cited by JBS, the region’s population was approximately 745 million in 2024.

Indonesia is also strategically important to the global halal food market. The sector was valued at about $1.43 trillion in 2023 and is expected to reach $1.94 trillion by 2028, driven by population growth and rising demand for certified products, according to data from consulting firm DinarStandard cited by JBS.

Under the partnership, Australia will remain a “central pillar” of JBS’ geographic diversification strategy and serve as a platform for the company to expand in markets it considers strategic. At the same time, the funds raised will give JBS greater capacity to invest and accelerate growth in the region, according to the statement.

“Under the partnership structure, JBS Australia’s operations remain unchanged. The current management team retains control of day-to-day operations, and nothing changes for our 17,000 employees, customers, or producer partners,” JBS Australia CEO Brent Eastwood said in the statement. “This investment represents strong recognition of JBS Australia’s proven track record in building and expanding food businesses across Australia, New Zealand, and the rest of the world,” he added.

The joint venture also strengthens JBS’ position ahead of an expected increase in global meat consumption through 2034. A report by the Organization for Economic Cooperation and Development (OECD) and the Food and Agriculture Organization of the United Nations (FAO) projects higher consumption of all protein categories during the period, highlighting Indonesia, the Philippines and Vietnam, among other countries, as key drivers of growth.

JBS said the transaction remains subject to the necessary regulatory approvals in Australia and customary closing conditions for transactions of this nature.

Danantara is being advised by PwC, BCG, A&O Shearman, and Barrenjoey. JBS is being advised by EY, De Brauw Blackstone Westbroek N.V. (Netherlands), and MinterEllison (Australia).