Source:  Lisa M. Keefe, MEATINGPLACE.COM, 12/28/10

Brazil's JBS SA is in the final planning stages for another issue of convertible debentures to raise around 4 billion Brazilian reals ($2.36 billion), with which the company will pay off an earlier issue of debentures, which were sold in February 2010, according to a release on the company’s website.

The funds may enable the company to cancel its plans for an initial public offering for its U.S. subsidiary, which had been tentatively slated for 2011.

In the release, JBS said the debentures will be due in five years and will pay an interest rate of 8.5% a year.

"Among the advantages of the new issuance are the elimination of the obligation to make the IPO (initial public offer) of JBS USA in 2011 and the optimization of the tax and financial structure of the company," JBS said in the release. "The terms and characteristics of the new debenture issuance will be detailed in the near future and will be subject to the necessary approvals."

And IPO for the U.S. unit had been in the works since the end of 2009, but the global economic downturn has been keeping those plans in limbo.

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