The controversial return of Brazil’s billionaire beef barons
The world’s largest meatpacker, JBS, listed in New York on Friday, marking a dramatic turnaround for the Batista brothers
Michael Pooler in São Paulo
Cattle at a JBS facility in Tucumã, Brazil © Jonne Roriz/BloombergAlmost eight years ago, Wesley and Joesley Batista were in jail, engulfed in a corruption scandal that nearly toppled a president and stained the name of their global meat empire.
All that was a distant memory for the brothers from Brazil when JBS began trading on the New York Stock Exchange on Friday, capping one of the most dramatic comebacks in business of recent history.
The long-coveted US share listing for JBS, a titan of the food industry, was a marquee moment for the men who transformed their family slaughterhouse into the planet’s largest meatpacker.
The group says the move of its primary stock trading venue from São Paulo’s B3 bourse to the NYSE will open the door to cheaper funding and boost its shares, which trade at a discount to American rivals.
“With a stronger balance sheet, more financial solidity and greater access to capital markets, JBS will be able to increase production and help feed the world,” says chief financial officer Guilherme Cavalcanti.
Once pariahs in Brazil for their confessed role in a political graft scheme, the billionaire beef barons behind the company are courting the limelight again.
They rub shoulders with luminaries of Brazilian politics and business at events, even posing for photos with French President Emmanuel Macron in Paris recently.
The FT spoke with about a dozen people who have worked for or know the men.
“It’s important for them to be back in the game,” says one. “They live on it.”
However, the very public re-emergence has sharpened scrutiny of the brothers and their activities, from the environmental impact of JBS to their political connections.
The meat processor is the crown jewel in the Batista family holding group, J&F Investimentos, which owns a 48 per cent stake. With interests spanning fintech and energy to cosmetics, the conglomerate calls itself Brazil’s largest private employer with 180,000 workers.
Wesley Batista is the quieter brother and is said to be a highly regarded manager with an eye for operational detail © Tuane Fernandes/Bloomberg
Joesley Batista is the more outgoing brother who focuses on new businesses and diversification for J&F, according to employees © Andre Coelho/BloombergOpponents ranging from conservationists to American cowboys called on investors and regulators to block JBS’s NYSE listing because of the brothers’ chequered history, concerns about deforestation in the Amazon linked to cattle ranching and greenhouse gas emissions from livestock.
Alexandria Reid of campaign group Global Witness describes it as “a disaster for both people and the planet”.
Wesley and Joesley Batista declined interview requests, but JBS rejected such portrayals, insisting it fights deforestation and is implementing sustainable practices to reduce its carbon footprint.
In parallel to the environmental concerns, proxy advisers recommended minority shareholders reject the listing proposal because a new dual-class share structure could potentially hand the Batistas 85 per cent of voting rights.
The company pointed to similar arrangements at other big companies, claiming it will ensure a controlling shareholder crucial to its success.
Ultimately, outside investors approved the plans.
“There’s an enormous value opportunity,” says Michael Martino, founder of shareholder Mason Capital Management.
“The attraction is quite simple. It’s a big, dominant player with massive economies of scale.”
The stock opened at $13.65 and ended the day almost 2 per cent higher with a market capitalisation of about $15bn, according to LSEG data.
Yet in Brazil, the brothers remain divisive figures, whose controversial record can still stir wariness.
Some question what their return to prominence says about the country.
“The Batista brothers are the perfect representation of the impunity that has plagued Brazil for decades,” says Deltan Dallagnol, formerly the lead prosecutor in the sprawling anti-corruption drive known as Car Wash, who was not involved in the Batistas’ case.
People close to the brothers say they have paid for past misdeeds, though not everyone is convinced.
“Once again, they move among the powerful, but they haven’t yet managed to fully restore their image in the public opinion,” says a person acquainted with them.
JBS took its name from the brothers’ father, José Batista Sobrinho, who in 1953 set up a small butcher’s shop in Brazil’s interior.
Within a few year,s he was supplying meat for workers building the new capital, Brasília.
The business grew and his two sons joined.
From the mid-2000s, the brothers embarked on an overseas expansion through acquisitions in Latin America, the US and Europe, as well as floating in São Paulo.
The meteoric rise was assisted by financing from Brazil’s state development bank, BNDES, which today holds almost one-fifth of JBS equity. It benefited from a drive by previous governments led by the Workers’ party of President Luiz Inácio Lula da Silva to create “national champions”.
While critics slammed the policy as a poor use of public money, JBS has proved very lucrative for BNDES, returning nearly threefold on the R$8.1bn ($1.5bn) invested in shares since 2007.
Thiago Carvalho, a professor of agribusiness at the University of São Paulo, says underpinning the success is a relentless drive for efficiency: “JBS was one of the first domestic meatpackers to really professionalise.
Even when they enter other businesses, they seek to be the best.”
Joesley, 53, conducted relations with government.
Today, his focus is new businesses and diversification for J&F, according to employees.
In Instagram videos, he dispenses motivational tips.
“Be the first to arrive.
That will make a difference in your lives that you can’t even imagine,” he tells students in one.
Wesley, 55, is quieter and is a highly regarded manager with an eye for operational detail.
Employees say the brothers’ work ethic and empowerment of managers pervades company culture.
However, in May 2017 the brothers, along with five other executives from JBS and its parent group, admitted to prosecutors that multimillion-dollar payments had been made to hundreds of public officials and political candidates in exchange for favours, such as funding.
Under an offshoot of Operation Car Wash, the probe into political graft that rocked Brazil’s establishment, the allegations included a secret recording of then-president Michel Temer apparently discussing bribes with Joesley.
It sparked calls for Temer’s resignation.
“We made mistakes and apologise,” read an open letter by Joesley at the time.
A plea bargain and fines ensured no criminal charges.
J&F agreed to a record penalty of R$10.3bn with Brazilian authorities, to be paid over 25 years.
It later paid $256mn in a similar co-operation agreement with the US Department of Justice.
The meatpacker insists it has learnt from the episode and has reformed compliance systems to prevent any repeat. CFO Cavalcanti says the misdeeds were by a handful of individuals: “It wasn’t institutionalised.”
While the brothers resigned from senior roles and JBS and J&F both sold assets following the settlements, the turbulence did not slow the meatpacker’s momentum in the long run.
From its origins in beef, the group has branched out into poultry, pork, lamb and more recently other proteins such as fish, plant-based alternatives and eggs.
Unlike many of the large construction contractors targeted by Car Wash, JBS has prospered since the scandal broke.
To defenders, it is evidence the business model did not rely on graft.
Since 2017, its turnover has increased 50 per cent, hitting $77.2bn last year.
Net profit was $1.8bn, and debt fell.
To observers of Brazilian public life, the Batistas’ political rehabilitation was blessed on a visit to a JBS plant by President Lula last year.
“Joesley and Wesley are responsible for this company becoming the largest animal protein producer in the world.
And that, for me, is a source of pride,” said the leftwinger, who was serving his first stint in office when JBS took off in the early years of the century.
Weeks later, the brothers attended a meeting of meat sector representatives, hosted by Lula at the presidential palace, to discuss disaster relief after floods.
Last month, Joesley had an audience with the country’s central bank governor.
“The Batista brothers have returned to the political scene,” says Eduardo Grin, professor of political science at the Getulio Vargas Foundation.
“They have a lot of influence in Brasília”.
Given how JBS obtained benefits from the public sector in the past, the appearances raised questions in some quarters.
The conglomerate says such outreach is not unusual: “As the largest private employer in Brazil, it is natural and expected that the J&F Group maintains ongoing dialogue with public authorities in all regions where it operates, always in full compliance with applicable laws and its code of conduct and ethics.”
Insiders and advisers say there is no special relationship with the government, cronyism or undue influence.
They also point out that Batista companies were granted infrastructure licences under former rightwing president Jair Bolsonaro.
Cattle roam in Amazonas state. Last year, the Batista brothers were dragged into a fresh political controversy when opposition lawmakers alleged favourable treatment towards Âmbar Energia, a J&F business expanding in the state © The Washington Post/Getty Images“How they think isn’t left or right.
It’s about power,” says one person familiar with J&F.
The Batistas’ path to redemption has also been smoothed by a string of favourable legal outcomes.
In 2023 the brothers were acquitted of insider trading by Brazil’s securities regulator — for which both were held in pre-trial detention for six months in 2017-18 — reversing what J&F called an “injustice”.
They then rejoined the JBS board last year.
In another key ruling, a supreme court judge in December 2023 suspended J&F’s mega-fine, expressing doubts about whether the agreement with prosecutors was voluntary.
It fitted into a broader dismantling of the legacy of Car Wash.
Opponents say the probe was politically motivated and involved abuse of due process.
(Among the dozens of politicians and businessmen it jailed was Lula, whose conviction was later overturned.)
However, the fine’s suspension raised claims of a conflict of interest by critics, because the justice’s wife had worked as legal counsel for J&F on an unrelated case.
A person close to the judge previously said that Brazilian law did not require the official to recuse himself.
Last year, the Batista brothers were dragged into a fresh political controversy.
Opposition lawmakers alleged favourable treatment by the Lula administration towards Âmbar Energia, a J&F business expanding in the power sector.
Âmbar had agreed to purchase a dozen gas-fired plants, whose clients include a financially troubled regional electricity distributor in the jungle state of Amazonas.
A government measure to support the Amazonas distributor altered its contracts with the Âmbar plants, shifting the burden of future payments onto customer bills nationwide.
“What concerns me is the use of a decree to transfer . . . losses to the consumer, benefiting a specific business group,” says rightwing congresswoman Adriana Ventura.
“The impression is of favouritism.”
This accusation is strongly denied by the government and J&F.
The mines and energy ministry said the measure was not designed to benefit a particular company, but rather to guarantee electricity supply in the region.
Potential assistance options for the distributor drawn up by a technical group were made public several months before Âmbar won an auction for the power assets, it added.
J&F said: “Any of these solutions would resolve the credit risks for the plants involved in the acquisition by Âmbar, signed four months later.”
Government insiders consider the attack politically motivated and initiated by losing bidders on the power facilities.
People in São Paulo protest against Michel Temer after allegations against the former president included details of a secret recording of him apparently discussing bribes with Joesley Batista © Cris Faga/NurPhoto/Getty ImagesYet attention on the wider group’s political activities is not limited to Brazil.
US senator Elizabeth Warren recently questioned whether a $5mn donation by poultry producer Pilgrim’s Pride, an American subsidiary of JBS, to President Donald Trump’s inauguration this year, the single largest sum received, was made to “curry favour” with the administration.
“We have a long bipartisan history of participating in the civic process and look forward to working with the administration,” Pilgrim’s Pride said.
Even as the Batista brothers have charted a personal comeback, a sore spot for JBS has been the long-running accusations from green activists that the company fuels land clearances in critical ecosystems, to make way for cattle grazing.
The company responds by stressing its “zero tolerance” sourcing policy that prohibits purchases from farms with deforestation, forced labour or on indigenous lands.
“It’s in our interest that [deforestation] doesn’t happen because we depend on the climate to have pasture for animals,” says CFO Cavalcanti.
At JBS’s HQ in São Paulo, a geospatial monitoring system displays the locations of all its suppliers across the country.
Filters indicate issues detected by public agencies and the company blacklists properties with irregularities — 14,000 at present.
However, cattle in Brazil can pass through several farms before reaching the abattoir, making it hard to track the true origins of animals.
From next year, JBS will require suppliers to provide information on who they buy from.
It runs a network of field offices providing assistance for ranchers to comply with environmental regulations.
“The farmer has to take responsibility for the legal purchase of animals,” says Liège Correia, director of sustainability at JBS Brazil.
“We are now sharing this responsibility with our direct suppliers”.
Beef production is the main driver of Amazon deforestation, according to the NGO Imazon.
Researcher Paulo Barreto says the company has made progress, but more action was required from both it and the wider sector, especially around “indirect” suppliers further down the chain.
JBS argues the only definitive solution is a mandatory nationwide cattle identification system.
In the meantime, it is supporting an initiative in the Amazonian state of Pará that will track animals throughout their lives, via compulsory electronic ear tags.
Despite its pledges, JBS was among meatpackers and ranches fined last year by Brazil’s environment agency for allegedly raising or buying cattle on illegally deforested lands.
The company says none of the purchases indicated by the environmental agency occurred on forbidden areas and is appealing.
Wesley and Joesley Batista’s grand ambitions are underlined by J&F’s promise to invest about $7bn in Brazil and create 30,000 new jobs over the four years to 2026.
The group recently won a long-running legal fight for full ownership of a large pulp mill in Brazil, buying out the other 49 per cent for R$15bn ($2.7bn) aided by debt financing.
Workers prepare poultry at JBS facility in Lapa, Brazil. Opponents tried to convince investors and regulators to block the company’s NYSE listing because of the Batista brothers’ chequered history and concerns about Amazon deforestation © Eraldo Peres/APAbout nine-tenths of J&F’s consolidated revenues, earnings and debt are from JBS, according to analysts at rating agency S&P, who said they were not at present concerned by the conglomerate’s expansion plans.
JBS is moving further into processed foods as a way to reduce exposure to the volatility of commodity meats.
“We want to increasingly be a company with a greater percentage of its revenues in prepared foods and brands,” says Cavalcanti.
With half its sales in the US and significant exports to China, it is now investing $2.5bn to build plants in Nigeria in a bet on rising meat demand in Africa.
“The company is going through a very positive phase,” says Leonardo Alencar, analyst at the brokerage XP. “Diversification is a way for it to deliver higher margins.”
And for all those who doubt the brothers’ penitence, they are not without admirers.
“It’s unbelievable what they’ve achieved. JBS is a national pride,” says Ricardo Faria, the founder of Brazil’s largest egg producer, Granja Faria.
“I’ve done business with them for 10 years and never had any problems.
They are tough, but always fair.
I think they came out stronger from the problems.”
Additional reporting by Beatriz Langella
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