Brazilian development bank BNDES is calling on JBS SA investors for support in taking legal action against the meatpackers’ executives and controlling shareholders for losses they allegedly caused, according to a report by Reuters.
BNDES is seeking backing by JBS SA shareholders for their anti-management suit as the bank seeks compensation for damages caused by a political bribery ring in Brazil a few years ago.
In 2017, the owners of controlling shareholder J&F Investimentos, Joesley and Wesley Batista, confessed in a plea bargain deal with prosecutors that they had paid out millions of reais in bribes to Brazilian politicians.
The Batista brothers claimed that they had spent $184 million to bribe nearly 1,900 politicians. As a result of the deal, J&F Investimentos were ordered to pay a $3.2 billion fine within 25 years for its role in corruptions scandals and the brothers were ousted from the company’s management.
However, their father, 87-year-old Jose Batista Sobrinho, continued to serve as JBS’ chief executive until COO Gilberto Tomazoni succeeded him in 2018.
BNDES – which holds a 21.32% stake in the meatpacker making it the largest single minority shareholder – has now sent a letter to JBS calling an investor meeting to discuss the plea bargain and leniency deal that had been signed in 2017.
The development bank plans to discuss with JBS’s shareholders a potential legal action to urge the meatpacker’s executives and controlling shareholders to take responsibility for the losses.
Since the scandal, BNDES has been battling to exclude the brothers and other JBS controlling shareholders from the investor meeting and has now announced that they have been victorious. According to Reuters, the Batista family are unable to vote on whether the class action against it and other controlling parties proceeds.
When approached by Reuters, J&F and the Batista brothers did not immediately comment on the matter.
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