Raízen, the joint venture between Cosan and Shell, is in negotiations to sell four sugarcane mills, reported Valor International citing source familiar with the talks. .
The mills involved are Santa Elisa in Sertãozinho (São Paulo), Rio Brilhante and Passatempo in Mato Grosso do Sul, and Continental in Colômbia (São Paulo).
Discussions are ongoing with local companies that could gain operational synergies by incorporating these assets into their existing production networks. Raízen may sell either just the sugarcane plantations or the entire mills with the fields, according to the news report.
These four mills were originally part of Biosev, which Raízen acquired from Louis Dreyfus Company (LDC) in 2021. Previously, Raízen sold the Leme mill and the sugarcane plantations of the MB mill, also from Biosev. Leme was sold to a joint venture between Usina Ferrari and Agromen, while MB’s fields were acquired by Usina Alta Mogiana.
The Biosev acquisition, comprising nine mills, cost Raízen R$3.6 billion. However, as per the media report, sources indicate that the purchase turned out less favorable than expected. Although Biosev’s plantations delivered strong agricultural yields, the mills did not align well operationally with Raízen’s existing infrastructure, complicating integration and management.
The sale of Leme and MB’s fields generated R$800 million. For the four mills currently being negotiated, Raízen aims for a valuation of $60 to $70 per metric tonne of installed sugarcane processing capacity, even when selling only the plantations.
While these sales form part of a strategy to raise funds and reduce debt, Raízen expects to obtain “good prices” for the assets. Successful transactions at the targeted valuations could bring in an additional R$4.5 billion, Valor International reported.
