It is understood that Brazilian meat giant JBS has entered into exclusive negotiations with a preferred bidder for the sale of Northern Ireland poultry processor Moy Park. The Irish Farmers Journal has learned that other parties interested in Moy Park have been told they’re out of the process as JBS looks set to strike a deal in the coming weeks.

A number of Chinese businesses, including agri food conglomerate New Hope and the privately-owned meat processor WH Group have been closely linked with Moy Park. A price tag of close to £1bn is expected for Moy Park, which is similar to the £990m paid by JBS for the business two years ago.

However, the depreciation in the value of sterling since the Brexit vote last year means JBS is likely to take a significant loss on the sale. JBS funded its acquisition of Moy Park in 2015 through US dollar denominated debt, which came to $1.5bn at the time. At today’s exchange rates, £1bn translates to less than $1.3bn leaving JBS with a $200m shortfall on its original investment.

The case for acquiring Moy Park was further boosted this week as the business reported a healthy set of second quarter results, despite what chief executive Janet McCollum described as a “challenging market”.

Moy Park reported a 7% increase in second quarter sales to £392m, driven by sales volume growth and a favourable exchange rate. Like-for-like earnings (EBITDA) increased 1% to £34m, leaving the business with a very healthy earnings margin of 8.7%. Net debt was reduced slightly to £193m, meaning the business has a very manageable net debt to earnings ratio of 1.56 times