Brazil-JBS and National Beef Packers acquisition.

BRAZIL-JBS AND NATIONAL BEEF PACKERS.

Brazilian meat company JBS SA is in talks with the U.S. Justice Department about divesting assets in order to gain approval to buy National Beef Packing Co, JBS-USA’s chief executive said on Friday.

The Justice Department has blocked JBS from buying National Beef, the No. 4 U.S. beef processor, saying the deal would give JBS too much control in buying cattle and selling beef.

JBS is the world’s largest beef producer. In the United States it is the No. 3 beef producer, but would become the largest with the National Beef purchase, industry sources said.

Talking to reporters on the sidelines of a cattle industry conference here, Wesley Batista, chief executive of JBS-USA, said the talks with the Justice Department were proceeding and he was hopeful for a settlement.

"The discussions are about divesting assets, not closing any plants," Batista said on the sidelines of the National Cattlemen’s Beef Association convention here.

Batista would not say which assets were being discussed.

There has been industry speculation that discussions have focused on two beef plants, one in Arizona and one in California.

JBS became the No. 3 U.S. beef producer in 2008, when it bought the beef operations of Smithfield Foods Inc, which included beef plants and the Five Rivers Ranch cattle feeding operation. At that time it also tried to buy National Beef, a deal valued at $970 million in cash, stock and debt.

On Thursday, a court hearing regarding the Justice Department’s suit to block the National Beef purchase was postponed until March 6.