(Rewrites to add detail of capital increase, SALIC and Minerva plans)
SAO PAULO, Dec 23 (Reuters) - Saudi Agriculture and Livestock Co said on Wednesday that it agreed to buy 19.95 percent of Brazilian beef exporter Minerva Foods SA for $188.4 million, moving ahead with an aggressive international expansion program.
The purchase is part of a capital increase approved by the Minerva board to sell up to 1.56 billion ($396 million) of new stock in the Barretos, Brazil based meatpacker. The stock sale plan values Minerva stock at $15.60 a share.
Minerva shares rose 8.55 percent to 12.69 reais in trading in Sao Paulo on Wednesday and have gained 14 percent in little more than a week.
Minerva, controlled by Brazil’s Vilela de Queiroz family through a shareholders agreement with Brazil’s BRF SA, the world’s largest poultry exporter, said the sale will help it reduce its debt and expand markets.
Despite rising sales, Minerva’s debt, primarily in foreign currency, has ballooned to nearly double its cash as Brazil’s real has weakened against the U.S. dollar. Minerva, one of South America’s largest beef producers, exports to 100 countries.
The purchase by SALIC, as the Saudi company is known, comes as the end of a decade-long China-led commodities boom drives down prices for agricultural products and the companies that produce them.
SALIC has targeted investments in beef and eight key crops, including wheat, barley, corn and soybeans. The Minerva sale follows its decision in April to team up with U.S. grain trader Bunge Ltd to create G3, which bought 50.1 percent of Canadian grain handler CWB for C$250 million ($180 million).
Under a new shareholders agreement SALIC will back the Vilela de Queiroz family in retaining effective control of the company after the sale on terms similar to those for BRF.
($1 = 3.94 Brazilian reais)
$1 = 1.39 Canadian dollar Reporting by Luciana Bruno and Jeb Blount, writing by Stephen Eisenhammer and Jeb Blount, editing by William Hardy