Brasil Foods SA has gained regulatory approval, with restrictions, on the 2009 merger of Perdigão SA and Sadia SA that created it.
Brasil Foods, according to Brazilian antitrust regulator Cade, must get rid of or suspend roughly 12% of its production capacity in order to meet the necessary requirements to stay in business. Among other concessions, the company must stop using the Perdigão and Batavo brands for as long as five years, and sell 10 food processing plants, 12 other brands, eight distribution centers and four pork and chicken slaughterhouses, according to reports.
In response to the news, Brasil Foods' stock gained 2.767% to reach 29.34 reais at 12:04 p.m. ET in São Paulo trading, the highest since May 18.