Standards & Poor (S&P) has downgraded the credit rating of Irish poultry producer Moy Park because of its parent company's links to Brazil's meat corruption scandal.
The rating agency said the action followed similar concerns about Moy Park's owner JBS, which is one of several companies accused of bribing health officials in Brazil to forgo inspections and overlook practices including processing rotten meat.
"The main reasons cited for this downgrade included severe governance deficiencies in light of the recent corruption scandals and the possible additional contingency liabilities that could arise from ongoing investigations by the US department of justice, the Brazilian Securities and Exchange Commission, and the Brazilian Federal Revenue Office," S&P said. The agency also noted JBS had significant short-term debt.
“Given the recent negative publicity and ongoing corruption investigations, it may be difficult to refinance this debt in a timely manner without a significant increase in interest costs.”
S&P said it expected to resolve the CreditWatch placement on Moy Park when it resolved the one relating to JBS, which is expected to take 90 days.
The Craigavon-based Moy Park, which employs 8,500 people in Northern Ireland, recently moved to reassure consumers that none of its products are sourced from the Brazilian plants currently under investigation for exporting contaminated meat to Europe.
