By Brazil Stock Guide – JBS (NYSE: JBS; B3-listed BDR: JBSS32) has entered into a partnership with Danantara Investment Management, the investment arm of Indonesia’s sovereign wealth fund, to turn its Australia and New Zealand businesses into the foundation of a new protein growth platform in Asia.
Danantara has committed to invest $2.5 billion in stages by subscribing for new shares that will ultimately give it a 25% stake in the joint venture. The partnership could mobilize as much as $5 billion, including the expected future raising of up to $2.5 billion in external debt.
The central appeal for JBS is the ability to finance a large-scale expansion in Asia without immediately issuing shares at the parent-company level or funding the entire investment program on its own. JBS will retain operational and corporate control of the platform while sharing the risks of new investments with a sovereign partner.
“We are creating the conditions to expand our presence in Asia,” JBS Global CEO Gilberto Tomazoni said. According to Tomazoni, the partnership is intended to use the Australian business as a platform to strengthen regional protein supply chains and expand the company’s access to Southeast Asian markets.
The business includes beef, lamb, pork, seafood and higher-value-added food products. Its assets include salmon producer Huon Aquaculture and pork producer Rivalea, as well as brands such as Swift, Great Southern, Primo and Beehive.
Brent Eastwood, CEO of JBS Australia, said the existing management team will continue to run day-to-day operations and that “nothing changes for our 17,000 employees, customers and producer partners.”
Corporate expansion meets industrial policy
Danantara is not a conventional financial investor. Established under Indonesia’s Law No. 1 of 2025, the sovereign wealth fund operates under the authority of the country’s president and has a mandate to manage and optimize state-owned assets, promote industrialization and support projects considered strategically important to Indonesia.
That helps explain why the committed capital must be invested exclusively in Indonesia during the first two years after closing. The agreement is not designed solely to generate returns from JBS’s established Australian assets. It also aims to build protein production, processing and distribution capacity in Indonesia.
For JBS, Danantara provides capital and an institutional partner with knowledge of the local regulatory and business environment. For Indonesia, the partnership offers access to technology, operating expertise and supply-chain capabilities from one of the world’s largest protein companies.
JBS estimates that the markets covered by the partnership have a combined population of approximately 745 million people. Indonesia is also a key market for the halal food industry. The latest report from DinarStandard estimates that global spending on halal food reached $1.53 trillion in 2024 and could rise to $2.06 trillion by 2029. The expansion of certified production and localized supply chains is among the major trends identified by the consultancy.
“It’s a smart move. Indonesia is a massive market and remains largely closed to foreign players,” an international trader told Brazil Stock Guide.
How the corporate structure will work
At the corporate and strategic levels, Danantara’s entry will bring new governance rights, veto powers and economic protections. The structure is more complex than a straightforward sale of a 25% stake for $2.5 billion.
At closing, Danantara will invest only $800 million and receive an actual equity interest of approximately 9.64%. The remaining $1.7 billion will be invested over the following three years as opportunities are identified under an acquisition plan.
Before the transaction is completed, JBS will transfer 100% of its interests in the Australia and New Zealand businesses to a new Dutch holding company, incorporated in the same jurisdiction as the group’s global parent, JBS N.V. Danantara will subscribe for newly issued shares in that holding company, leaving JBS with an expected 75% stake once the full investment has been made.
The distinction matters. The money will remain inside the joint venture to fund expansion. This is not a secondary share sale under which the $2.5 billion would be paid directly to JBS for distribution to shareholders or debt reduction at the parent-company level.
Deal math points to a $7.5 billion pre-money equity valuation
Danantara’s subscription for 25% of the joint venture for $2.5 billion implies a $10 billion post-money equity valuation once the entire investment has been completed. Excluding the new capital, the businesses contributed by JBS have an implied pre-money equity value of $7.5 billion.
The initial investment produces the same result. An $800 million investment for a 9.64% stake implies a post-money equity valuation of approximately $8.3 billion. Subtracting the initial contribution again produces a pre-money value of roughly $7.5 billion.
This calculation represents equity value. JBS’s material fact notice does not disclose how much cash, debt or other liabilities will be transferred to the new holding company. The $7.5 billion figure should therefore not be treated as enterprise value.
Dividing the implied $7.5 billion equity value by the business’s 2025 EBITDA would produce a ratio of approximately 8.2 times. That is not a conventional enterprise-value-to-EBITDA multiple and should not be compared mechanically with the trading multiples of JBS or its peers without knowing the joint venture’s net debt.
The platform is a significant part of the wider group. In 2025, JBS’s Australia segment generated $8.08 billion in net revenue and $916 million in adjusted EBITDA, for an EBITDA margin of 11.3%. The business accounted for approximately 9.4% of JBS’s consolidated revenue and 13.5% of consolidated EBITDA, according to Brazil Stock Guide calculations based on the company’s annual report.
Funding will be deployed in three stages
The first stage will take place at closing. JBS will contribute the Australia and New Zealand businesses to the Dutch holding company, while Danantara will invest $800 million. The fund’s initial actual ownership will be approximately 9.64%.
In the second stage, Danantara may be called on to invest the remaining $1.7 billion over the following three years. The disbursements will be tied to opportunities approved under an acquisition plan to be prepared by the joint venture’s board.
During the first two years after closing, Danantara’s capital may only be used for protein-sector projects and businesses in Indonesia. The mandate includes greenfield developments, acquisitions and investments in existing companies.
After that two-year period, any remaining capital may be deployed across a broader geographic area, including the rest of Southeast Asia, Australia and New Zealand. The money may also be used for greenfield projects or brownfield expansions of existing facilities.
The third stage will depend on Danantara completing its full investment. Only then does the joint venture expect to raise up to $2.5 billion in external debt. The announcement does not identify potential lenders or disclose expected borrowing costs, maturities, guarantees or a timetable for the financing.
The headline $5 billion figure should therefore be understood as the partnership’s maximum potential funding capacity, not as cash that will be available at closing.
Danantara will receive 25% rights before investing the full amount
One of the agreement’s more unusual features is the temporary difference between Danantara’s actual legal ownership and its rights within the joint venture.
During the first three years after closing, the fund will be deemed to hold a 25% interest for governance and economic-interest purposes, provided its actual ownership remains above 7.5%. Because the initial $800 million investment will give Danantara a 9.64% stake, the condition will be satisfied from closing.
In practice, Danantara’s rights will not increase gradually with each capital contribution. They will begin as if the full commitment had already been funded, even though only $800 million will initially have been invested. After the three-year period, governance rights will be determined by the parties’ actual ownership stakes.
The joint venture will have a board of up to seven directors. JBS will appoint five – two executive directors and three non-executive directors – while Danantara will appoint two non-executive directors. JBS will therefore retain a clear board majority and corporate control.
Danantara will nevertheless have effective veto rights over certain material decisions. These include new share issuances, corporate reorganizations, debt above an agreed leverage ratio, disposals of material assets, liquidation and dissolution.
Those rights do not give Danantara operational control, but they prevent JBS from acting unilaterally on decisions that could materially alter the value or risk of the minority stake.
EBITDA decline could lift Danantara’s stake to 30%
The agreement also protects Danantara against a deterioration in the platform’s earnings shortly after the transaction.
Once Danantara has completed its full investment, the joint venture will compare its 2025 EBITDA with the average of its 2026 and 2027 results. If the two-year average falls below 2025 EBITDA, Danantara will be entitled to compensatory shares.
The fund’s ownership could consequently increase from 25% to as much as 30%. At the upper limit, JBS’s stake would fall from 75% to 70% without a proportional additional investment from the Indonesian partner.
The provision is significant because 2025 was a strong year for JBS’s Australian business. Segment EBITDA rose 37.9% to $916 million, creating a demanding comparison base.
Early 2026 results already show pressure on margins. In the first quarter, Australia segment revenue rose 32.3% to $2.14 billion, but EBITDA fell 17.2% to $132.8 million. The margin narrowed to 6.2% from 9.9%, mainly because of a 29% increase in cattle prices.
A single quarter will not determine whether the adjustment is triggered, because the test is based on the average full-year EBITDA for 2026 and 2027. Still, the early decline helps explain why the protection was negotiated and makes the Australian operation’s earnings one of the most important metrics to watch.
IPO is the preferred exit, with JBS shares as a fallback
JBS and Danantara have agreed to a mutual five-year lock-up, starting from the completion of the transaction.
The parties say they intend to pursue an initial public offering of the joint venture. An IPO could provide liquidity for Danantara, establish a public valuation for the platform and create a listed acquisition currency for future deals.
If an IPO has not occurred after the sixth anniversary of closing, Danantara may, on up to two occasions, exchange all or part of its joint venture stake for newly issued JBS shares.
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