Raízen Sells Usina Caarapó for R$ 760 Million to Bolster Financial Recovery
Raízen has sold its Usina Caarapó sugar mill for R$ 760 million to Adecoagro as part of its plan to reduce financial leverage and support its judicial recovery process.
- • Raízen sold Usina Caarapó to Adecoagro for R$ 760 million including sugarcane and supplier contracts.
- • The sale aims to reduce Raízen's financial leverage, currently at 5.3 times, amidst judicial recovery.
- • Raízen has raised approximately R$ 5 billion from various asset sales to support its recovery plan.
- • The transaction is pending approval from Cade and contractual conditions.
- • Recovery plan includes R$ 65 billion in debts restructuring with significant investments from Shell and Rubens Ometto's family office.
Key details
Raízen has announced the sale of its Usina Caarapó located in Mato Grosso do Sul to Adecoagro Vale do Ivinhema for R$ 760 million. The deal includes the transfer of sugarcane ownership and related supplier contracts from Raízen to Adecoagro. This transaction is a significant part of Raízen's ongoing strategy to streamline its asset portfolio and reduce its financial leverage, which currently stands at 5.3 times. The sale is subject to approval by the Administrative Council for Economic Defense (Cade) and the satisfaction of stipulated contract conditions.
Following this sale, Raízen will continue operating 23 sugar mills with an installed grinding capacity of approximately 69 million tons per harvest. The company is pursuing this divestment amid its judicial recovery process initiated in June, aiming to optimize its operations and improve profitability.
In addition to this transaction, Raízen has previously sold assets in Argentina for US$ 1.42 billion and other plants, cumulatively raising about R$ 5 billion in cash. This capital generation effort supports a broader recovery plan focused on restructuring R$ 65 billion of debt. Shell is expected to invest R$ 3.5 billion and Rubens Ometto's family office another R$ 500 million, with a proposal to convert 45% of Raízen's debts into equity in the company.
Raízen's shares have experienced a dramatic drop this year, falling 63.7% to trade below R$ 1, resulting in a market value near R$ 394 million, underscoring the urgency behind the company's financial restructuring and asset sales. The transaction, once approved, will mark a key milestone in Raízen's efforts to reduce leverage and stabilize its business amid challenging market conditions.
This article was translated and synthesized from Brazilian sources, providing English-speaking readers with local perspectives.
