By Brazil Stock Guide — MBRF has disclosed the amounts assigned to an arbitration challenging Marfrig’s acquisition of BRF’s remaining shares, without estimating the financial impact of a possible adverse ruling. Its October 22 filing cites R$60 million as the basis for calculating administrative fees.
Investment funds Nova Almeida and Latache IV brought the proceedings against Marfrig and BRF before the Market Arbitration Chamber (CAM), affiliated with Brazilian stock exchange operator B3. They challenge the exchange ratio — the number of Marfrig shares received for each BRF share — and seek to unwind the transaction and recover alleged losses.
The filing states that the funds’ alleged losses would be quantified at a later stage, should their entitlement to compensation be established. The R$60 million therefore represents neither the cost of the arbitration nor a cap on any potential damages award.
The amount combines claims from both sides: R$10 million is the funds’ estimate of the value of their dispute, while the remaining R$50 million represents the companies’ valuation of their counterclaim against the funds.
The potential economic scale becomes apparent when comparing the agreed exchange ratio with an alternative benchmark calculated by Apsis, a valuation firm hired by the companies. The transaction entitled shareholders to 0.8521 Marfrig shares for each BRF share. An appraisal of both companies’ net assets at market value, included in the transaction documents, produced a ratio of 2.26148 Marfrig shares per BRF share.
Applying the alternative ratio to the approximately 750.8 million eligible BRF shares identified in the transaction documents would yield about 1.698 billion Marfrig shares, compared with 639.7 million under the negotiated terms. The difference would be 1.058 billion shares, or 165.4%. Multiplying that difference by R$8.79458 — the per-share value of Marfrig calculated in the Apsis appraisal — produces a figure of approximately R$9.3 billion.
That figure illustrates the gap between the two valuation approaches; it is not an estimate of a damages award. The calculation assumes the alternative ratio applies in full to all eligible shares and excludes subsequent adjustments, dividends considered in the negotiations and the effect of additional share issuance on per-share value. The documents reviewed also do not establish that any compensation would extend to all former BRF minority shareholders.
The transaction documents themselves acknowledge that the Apsis ratio would be more favorable to BRF shareholders. However, that benchmark was prepared for the comparison required under Article 264 of Brazil’s corporate law and linked to dissenting shareholders’ withdrawal rights, which allow qualifying investors to exit the company in exchange for reimbursement. It was not designated as a mandatory exchange ratio or an automatic basis for compensation.
According to the companies’ summary of the arbitration, the funds allege that the special committees and financial advisers lacked independence, that the transaction involved conflicts of interest and that the exchange ratio disadvantaged BRF minority shareholders. They seek to invalidate the shareholder resolutions approving the transaction in August 2025, reverse its closing and obtain compensation for their alleged losses.
The companies reject the allegations and maintain that the transaction was conducted properly. The transaction documents state that independent committees negotiated the exchange ratio with support from external advisers, using a combination of valuation criteria. The negotiations also took into account dividend distributions of R$3.52 billion by BRF and R$2.5 billion by Marfrig. The companies accuse the funds of abusing their shareholder rights and the right to bring proceedings, and seek damages of their own, also subject to subsequent assessment.
MBRF and the funds did not respond to requests for comment by publication. Any responses will be added to this report.
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