Notice to the Market – Fitch Ratings upgrades rating – 12/17/2013


Minerva S.A. (“Company”), a leader in South America in the production and sale of fresh beef, live cattle and cattle byproducts, with operations also in the beef, pork and poultry processing segments, hereby announces to its shareholders and the market in general that Fitch Ratings (“Fitch”) revised the Company‘s risk rating one grade upwards from “B+” to “BB-“, with stable outlook. The local rating was also upgraded from “BBB+(bra)” to “A-(bra).”

According to Fitch, the upgrades reflect the solid fundamentals of the beef industry in Brazil, notably the consolidation trend observed in recent years, competitive cost structure as well as other advantages of the sector in the country. Added to these factors is the sharp growth of Brazilian beef exports, the focus of Minerva‘s operations. The rating agency emphasized the Company‘s strategy to diversify operations in South America and the expansion of its distribution channels in the domestic market. Fitch also recognized the Company‘s initiatives to improve its capital structure and affirmed that it expects Minerva to remain focused on free cash flow and reducing its leverage ratio in the coming quarters.

Lastly, Fitch underpinned the transaction for the acquisition of the beef plants of BRF S.A. (“BRF”) recently announced by the Company, which, once approved, will increase Minerva‘s production capacity and reduce its leverage ratio. As a result, BRF will hold a 15.2% interest in the Company.

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