Brazilian food producer MBRF has signed an investment deal with Saudi Arabia's Halal Products Development Company (HPDC) to boost their joint venture in the Middle East, which it later plans to list in Riyadh, it said on Monday.

A wholly-owned MBRF subsidiary will contribute assets worth $2.07 billion to the venture, the securities filing added.

HPDC is a subsidiary of Saudi Arabia's sovereign wealth fund, the Public Investment Fund.

MBRF, which was formed from the recent merger of pork and poultry processor BRF and beef producer Marfrig, said that under the deal HPDC will hold 10% of BRF Arabia, the investment vehicle for the joint venture.

HPDC has plans to raise its stake to 30% in the joint venture and has the right to increase it to 40% if certain conditions are met, MBRF's filing said.

MBRF shares rose more than 4% at the open.

Explaining plans to list the JV's shares in Saudi Arabia, MBRF's controlling shareholder Marcos Molina told a press conference that the multiples of companies traded at the Riyadh stock exchange are among the highest in the world.

Its biggest rival JBS listed shares on the New York Stock Exchange earlier this year to access a wider pool of investors and reduce its cost of capital.

MBRF plans to obtain all regulatory approvals for the transaction by the first quarter of 2026.

The IPO of BRF Arabia, to be renamed Sadia Halal at the closing of the transaction, is expected to take place in 2027, MBRF said.

(Reporting by Isabel Teles and Ana Mano; Editing by Gabriel Araujo and Jan Harvey)