BRASILIA, Brazil – Brazilian meat producers BRF S.A. and Marfrig Global Foods S.A. mutually agreed to halt negotiations on a possible merger on July 11.

In May, both groups agreed to a memorandum of understanding (MOU) with Marfrig giving the companies 90 days, and possibly 30 more days, to negotiate the potential combination of assets and shares.

In security filings, the two companies stated their reasons for stopping the deal at this point.

“The companies’ decision stems from the fact that the parties were unable to reach an agreement on the terms and conditions related to the governance that would govern the company, had the transaction occurred,” BRF said in a statement.  

A merger between the two companies would have created one of the largest meat producers in the world.

Marfrig released a similar statement and said the termination would not affect ongoing relationships between the two companies.

During December 2018, Marfrig acquired majority shares of Argentina-based Quick Food S.A. which was owned by BRF for $60 million. Marfrig also agreed to acquire real estate and equipment from a BRF unit located in Várzea Grande in the Brazilian state of Mato Grosso for 100 million Brazilian reais.

Both companies finalized other sales and acquisitions over the last year.

On June 4, Tyson Foods Inc. bought BRF S.A.’s Thai and European businesses, which featured four production facilities in Thailand and one in both the Netherlands and the United Kingdom. Marfrig also acquired Kansas City, Missouri-based National Beef Packing Co. LLC in June 2018.