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UPDATE 1-Brazil's Minerva to buy Australian Lamb Company for about $260 mln

(Recasts Oct. 20 story with Minerva's confirmation, adds details)

SAO PAULO, Oct 21 (Reuters) - Brazilian meatpacker Minerva SA said late on Thursday it has reached a deal to acquire lamb and sheep processor Australian Lamb Company Pty Ltd for around $260 million.

The beef-packer will make the purchase through a joint venture with Saudi fund Salic, which is also Minerva's largest shareholder.

According to a securities filing, following the deal Minerva will hold about 15% of the lamb and sheep market in Australia, where it already owns Shark Lake and Great Eastern Abattoir.

"We believe the consolidation of our operations in Australia, the investments in improving facilities and maximizing operational and commercial structures would bring significant synergies in the coming months," the firm said, without providing further details on the cost savings.

Australian Lamb Company has a slaughtering capacity of 3.78 million animals per year and owns two processing plants in the state of Victoria, Minerva noted, adding that exports account for 93% of its sales.

The Brazilian company expects the deal to improve its penetration in niche markets and expand its portfolio of products with greater added value.

Newspaper Valor Economico had first reported on the deal on Thursday, citing sources familiar with the matter. ($1 = 5.2131 reais) (Reporting by Peter Frontini and Gabriel Araujo Editing by Chris Reese)

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