Cosan Group promotes changes and plans strong expansion for Esso
Valor Econômico - 07/24/2008
The Cosan Group already has in its hands its strategies to manage its most recent business: Esso, the fifth largest fuel distributor in the country. The "Cosan philosophy", known in the sugar and alcohol market for being aggressive in mergers and acquisitions, should be implemented in the distributor, too. "We intend to make acquisitions and increase Esso's participation to 10% in a short time", said to Valor entrepreneur Rubens Ometto Silveira Mello, CEO of Cosan, the greatest sugar and alcohol company of Brazil and one of the largest ones in the world. The group takes over, from December on, 100% of the management of its new asset. In the meantime, the management is being shared. Significant changes have already started being made. One of them was the choosing of Cosan's Commercial and Logistics Vice-President, Marcos Lutz, formerly from Companhia Siderúrgica Nacional (CSN), as the arm of the alcohol giant inside Esso. It seems that the current president of the company, Carlos Piotrowski, will remain in office. In the country, Esso has a 5.9% market share, according to the most recent data of Sindicom (Fuel Distributors National Union). Getting 10% of this market, as Rubens Ometto intends, will not be a very easy task. Unlike the alcohol and sugar sector, a highly spread-out market with almost 400 plants and to a great extent still featuring familiar management, the fuel distribution segment is concentrated and it is mainly controlled by foreign capital. In the market, nobody doubts Cosan's capacity of expansion and that already makes the market even more attentive. First, because the rumors that Cosan would be interested in Texaco started growing again. The Ultra Group is considered the strongest purchaser, even though the market does not rule out Cosan as one of the possible proponents as well. Additionally, the executive, always with his "low profile" style, sustains that "he is always analyzing new opportunities". And, in general, that results in acquisitions. In the short term, Cosan's plans are to increase the number of Esso gas stations in the country. The company has nearly 1,500 units in 20 States and it intends to move on to other regions where it is not present. In December, the group will announce the investment budget for Esso. According to the executive, the synergy between Cosan and Esso will allow a reduction in costs for both companies.