In the last couple of years public development banks in some emerging countries gave strong support for local (national) companies to make acquisitions outside, expanding their operations to other countries. To build the called "national champions" US$ billions were invested and these investments gave different returns for local societies that financed it.

In the specific case of Brazil, some large corporations operating with animal protein, among other sectors, received support, which meant financing at lower interest rates than the ones available with private banks. This strategy built up global leaders in the beef and other meat producing chains, benefiting from the strong value of the local currency, the Real, in these acquisitions.

Some beef companies diversified their product lines and became animal protein companies (acquiring poultry and pork production lines, products and brands) and further on moved their strategies to broader food companies with a complete product line, from meats to milk, from ready to eat meals to pizzas and desserts. It is the emergence of new competitors for the traditional multinational food companies. In the opposite direction, the market has seen poultry companies going to beef, milk and others.

The objective of this story is to list what could be: a) possible benefits for local Government and as a consequence, to local societies to build these "world champions" and b) the major risks involved in such operations.

The possible benefits are that these outside operations could justify investments by helping to promote exports coming from the original country. This could be possible with more market access, one of the most important assets that come with an outside acquisition. For instance, when a Brazilian company acquires a company in Italy, or in China, it acquires access to these markets.

This access includes a local sales team, access to supermarkets and other marketing channels and knowledge of communications. It also includes the acquisition of local brands that may have tradition and connection/intimacy with consumers, instead of exporting with a national brand and building a new brand from zero, a very expensive and challenging activity in a different market.