09/17/2008 15h30
After merger, Votorantim foresees new partnerships and acquisitions
Gazeta Mercantil - 09/17/2008
After the agreement that will unite Votorantim Celulose e Papel (VCP) and Aracruz Celulose into one single business, a team formed by representatives of the groups Votorantim and Safra, partners in the holding that will manage the new company, starts now evaluating the operations in detail aiming at the integration. The expectation is to capture synergies equivalent to R$ 4.5 billion (US$ 2.76 billion), considering, mainly, cost cutting, greater negotiation power with customers and the operating structure, said the president of the Votorantim Industrial, Jose Roberto Ermírio de Moraes, yesterday. Together, the two companies are able to produce 4.5 million tons of cellulose a year, with a forecast of reaching 7 million up to 2010, and they may even go beyond that, to 13 million. However, the definition of the expansion projects will take place with the works of this group of transition and integration, and it depends on the performance of the market that has offered signs of weakening in the demand in this second half. But, for Ermírio de Moraes, the crisis should not inhibit the development of countries like China, India and Brazil. China has invested heavily in the production of paper and it drives the cellulose market. A change in this setting, with more modest growth rates, can stimulate new partners in the process of consolidation the sector goes through, said the entrepreneur. In such case, the merger guarantees structure for the new company to be the consolidator in this process, in the case of short fiber cellulose, a business in which these companies together hold 34% of global market share. The business man also pointed out the good margin of the companies, whose income consolidated in 12 months until last June was R$ 6.3 billion (US$ 3.9 billion) for an Ebitda (cash generation) of R$ 2.3 billion (US$ 1.41 billion). In the total of the cellulose market, considering all fibers, the participation of Aracruz and VCP together reaches 10%, informed Ermírio de Moraes. Questioned on the possibility of a union with Suzano Papel e Celulose, the business person said "everything is a matter of opportunity of the market" and he recalled that the two companies are already partners in Ripasa. The business man said Aracruz was a first step with possibilities of new acquisitions and partnerships in the future.
