Ann: Release of Bucephalus document, page-7

From AFR.

The Bucephalus report focused on RFF's acquisition of five feedlots and cropping land in July last year for $52.7 million in a sale-and-leaseback deal with cattle processor JBS Australia, a subsidiary of Brazil-listed pork and meat giant JBS.

As part of the deal, RFF provided a limited guarantee of $75 million to an existing entity called J&F Australia that currently acquires cattle for JBS Feedlots.

This deal and another cattle station acquisition were facilitated via a $149 million equity raising.

"The deal allowed RFM to use RFF money to take a 100 per cent equity stakein J&F at no cost," Bucephalus said in its report.

"This gives RFM any upside, and a 1 per cent fee the credit instrument issued to RFF, leaving RFF exposed to the downside.

"Given that the owners of JBS Brazil have a history of fraud, corruption and criminality, the risk is material."But a spokesman for RFM said the JBS deal was a "fabulous transaction" for investors in RFF, with "fabulous counterparty".

"Since that deal the JBS market capitalisation has tripled to $28 billion," the spokesman said.

"The group employs 275,000 workers around the world. They have had their difficulties in Brazil, which have been well documented. Everyone is well aware of that."