Mubadala to focus on ethanol with new investment

New York : Abu Dhabi’s investment fund, Mubadala Capital, is charting a distinct course compared to its counterparts in the Brazilian sugar and ethanol industry, reports Reuters.

It intends to make its foray into this sector by early next year, with a focus on expanding biofuel production and a relatively modest emphasis on sugar.

Bruno Serapiao, the CEO of Atvos, one of Brazil’s largest sugarcane processors, revealed in a recent statement to Reuters that Mubadala Investment’s asset management division, based in the UAE, is set to acquire a 31.5% stake in Atvos. This transaction is anticipated to take place either later this year or in the early months of the following year.

Currently operating under bankruptcy protection, Atvos is poised to receive a payment of 500 million reais ($102.83 million) from Mubadala once the Brazilian company emerges from its court debt protection, according to Serapiao.

While Mubadala had previously ventured into Brazil’s oil refining sector in 2021 and is actively investing in renewable fuels, the company notably withdrew from the bidding process for the ethanol joint venture BP Bunge Bioenergia, which ranks as the world’s third-largest sugarcane processor.

Contrary to the trend observed among numerous sugar and ethanol firms in Brazil, which are expanding their sugar production capacity to capitalize on historically elevated sweetener prices attributed to reduced production in certain countries. Atvos is prioritizing the augmentation of ethanol output. The company is even considering incorporating corn as a feedstock, given that a significant portion of its mills are located in Brazil’s primary grain belt.


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