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Incorporation of Biolins Energia S.A.
Material Fact
JBS S.A. ("Company"), in compliance with the provisions of Brazilian Securities Commission (Comissão de Valores Mobiliários ­"CVM")
Instructions No. 358/2002 and 319/1999, informs, to whom this may concern, that a proposal shall be submitted to the Company's shareholders
regarding the merger by the Company of Biolins Energia S/A, a Company with headquarters in the City of São Paulo, State of São Paulo, at, Av.
Brigadeiro Faria Lima, 2.391, cjto. 22, 2nd floor, room 23, ZIPCODE 01452-905, enrolled with the Federal Taxpayers Registry (CNPJ/MF) under No.
10.194.385/0001-29("Biolins"), as described below ("Merger").
The Company will submit to the shareholders in Extraordinary General Shareholders' Meeting, to be held on March 15, 2011, the proposal of
merging Biolins Energia S.A. with JBS S.A., referred to in the Protocol and Justification of the Merger ("Protocol and Justification").
Biolins, at the date of the merger, will be a wholly owned subsidiary of JBS. The Merger is part of a process of simplification of the corporate
structure of which the Company and Biolins are a part. The Merger will result, among other advantages, in operational simplification and cost
reductions on transactions between the companies.
Referring to a wholly owned subsidiary, there will be no capital increase in JBS and the Biolins shares will be extinguished, promoting the
required accounting adjustments at JBS. The net equity of Biolins will be merged into the Company taking into account its book value on October
31, 2010.
The management of the Company, ad referendum of the General Meeting that will examine the Protocol and Justification, has appointed Apsis
Consultoria Empresarial Ltda., enrolled with the Federal Taxpayers Registry (CNPJ/MF) under nº 08.681.365/0001-30, with headquarters in the
City of Rio de Janeiro, State of Rio de Janeiro, at Rua da Assembleia, 35, 12th floor ("APSIS") to perform the appraisal of the net equity of Biolins
to be transferred to the Company as a consequence of the Merger.
It is estimated that the costs of the Merger shall be up to R$200,000.00, including expenses with publications, auditors, appraisers, lawyers and
other technical professionals to be hired to assist in the transaction.
The Protocol and Justification are subject to final approval by the Extraordinary General Shareholders' Meeting of JBS.
The management of the Company and the Audit Committee approved the Merger, pursuant to the terms set forth in the Protocol and Justification
entered into by the management of the companies on this date ("Protocol and Justification"), and approved the summoning of an Extraordinary
General Shareholders' Meeting to be held on March 15, 2011 to resolve such matters.
The Protocol and Justification, the Appraisal Report and other documents referred to herein are available to the shareholders as from this date in
the Company's headquarters, and on the websites of the Company (www.jps.com.br/ri/), of CVM (www.cvm.gov.br) and of BM&FBOVESPA
S.A. ­ Bolsa de Valores, Mercadorias e Futuros (
www.bmfbovespa.com.br
).
São Paulo, January 26, 2011
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JBS S.A. © 2009 Todos os direitos reservados
Jeremiah Alphonsus O'Collaghan
Investors Relations Officer