Contacts:
Afonso Champi, Cargill Brazil, 55-11-5099-3446
Ana Caiasso, Cargill Brasil, 55 11 5099-3446
Bill Brady, Cargill Corporate, 952-742-6608
Geraldine O’Shea, Cargill Europe, 44-1932-861-408
Cargill Invests in Sugar & Ethanol Mill in Brazil
SAO PAULO – Maubisa and Cargill Agricola S.A. today announced the conclusion of negotiations for Cargill to take a 63% stake in Cevasa - Central Energetica Vale do Sapucai Ltda, making it effectively a joint venture between Canagril - the associated growers - and Cargill.
According to Maurílio Biagi, president of Maubisa, the deal with Cargill fulfills a personal desire to unite three positive factors in one transaction: enable Cargill to enter the sugar and ethanol production segment in Brazil by acquiring the only mill in the region of Ribeirão Preto with the capacity to expand production economically; provide an opportunity to his agricultural partners to realize their wish to expand sugarcane planting and production; and finally enable Maubisa to look for new projects in this segment, in addition to consolidating its position in the eight projects currently underway.
Biagi, who has always believed in the sector’s promising future, points out that Cevasa, which has been consolidating its position since its first crop in 1999, during the sector’s biggest crisis when ethanol was sold for R$0.14 per liter, has tripled its production and is highly profitable, showing that, based on the average of the last eight years, there is no disadvantage in not producing sugar, much to the contrary.
This decision is also opportune for Cargill as part of its global strategy for renewable energy sources. “Cargill has analyzed the important, growing sugar and alcohol industry in Brazil for some time, and becoming more active is logical step for us to expand our sugar and ethanol business and participate in the growth of this promising sector,” said Sergio Barroso, president of Cargill in Brazil. Barroso further mentioned the high degree of competitiveness reached by the Brazilian sugar cane industry through its technological, industrial and agricultural expertise.
No further details of the transaction were revealed.
About Cevasa
The mill began operations in 1999, and has an annual sugarcane processing capacity of about 1.4 million tons of sugarcane, representing about 125 million liters of ethanol. It is located near the town of Patrocinia Paulista, Sao Paulo.
About Cargill
Cargill is an international provider of food, agricultural and risk management products and services. With 142,000 employees in 61 countries, the company is committed to using its knowledge and experience to collaborate with customers to help them succeed.
Present in Brazil for over 40 years, Cargill Agricola S.A., has the profile of a diversified company. Its roots are tied to the agribusiness sector, and it is also one of the country’s most important good industries. Headquartered in São Paulo/SP, the company has industrial units and offices in about 180 Brazilian towns, with about 22,000 employees.
About Canagril
Canagril - Cana Agricola Ltda. holds 37.12% of Cevasa's capital stock, and its strategic partners in this industrial unit are the rural producers who guarantee its supply of quality raw material. For Canagril, this partnership with Cargill is important because Cargill has a good economic structure and follows a serious and competitive professional policy in search of results. With this partnership between Canagril and Cargill, Cevasa will become more competitive and will increase its production capacity. All the region around Patrocinio Paulista will benefit from this new strategic partnership.