Raízen, Brazil’s leading sugar and ethanol producer, announced on Monday the sale of its Caarapó mill to Adecoagro for 760 million reais ($130 million), as the company struggles to navigate the largest out-of-court debt restructuring in the country’s history.
The transaction includes the industrial unit in Mato Grosso do Sul, sugarcane assets, and supplier contracts. The mill processed approximately 3.5 million tonnes of sugarcane in the 2025/26 harvest. Following the sale, Raízen, a joint venture between Shell and Cosan, will operate 23 mills with a total crushing capacity of 69 million tonnes per harvest.
SHARES HIT HISTORIC LOWS
Despite the cash injection, Raízen’s shares plunged nearly 7% on the B3 exchange, hitting a new historic low of 0.27 reais. Investors remain skeptical that asset sales alone can address the company’s massive 65-billion-reais ($11.2 billion) debt pile.
The market capitalization of the company has shrunk to approximately 2.8 billion reais, a fraction of its total liabilities. Since the beginning of 2025, the company has wiped out 87% of its market value.
"POSITIVE BUT INSUFFICIENT"
Analysts noted that while the divestment helps streamline operations and provides immediate liquidity, it represents only about 1.2% of the company’s total debt.
"The sale is positive in terms of portfolio optimization, but it is insufficient to meaningfully deleverage the company or rebalance its capital structure," Citi said in a research note.
Raízen has been on a divestment spree since 2025, totaling 12.7 billion reais in agreed sales, including its fuel refining assets in Argentina and several solar and power marketing businesses.
ADECOAGRO EXPANDS FOOTPRINT
For Adecoagro, the acquisition marks a significant expansion. The company expects to boost its sugarcane processing capacity by 24% to 17.7 million tonnes. The Caarapó plant is located less than 100 kilometers from Adecoagro’s existing clusters in Angélica and Ivinhema, creating a highly integrated and competitive production hub in the region.
The deal remains subject to approval by Brazil’s antitrust regulator, CADE.
