Sale of Santelisa at the final stage
O Estado de S. Paulo 03/13/2009
GP Investimentos and the São Martinho Group got together and presented a joint proposal for the purchase of part of the assets of Santelisa Vale, the second largest sugar and alcohol Company of the Country. According to sources involved in the business heard by Agência Estado, the two companies will compete with other large groups in the dispute for a share corresponding to 40% of the debt, estimated at R$ 3 billion (US$ 1.3 billion), of Santelisa Vale. Among them are Louis Dreyfus Commodities, Bunge, Cosan and ETH, the sugar and alcohol branch of Odebrecht. The association of GP with the São Martinho Group surprises for the entrance of the traditional sugar and alcohol producer in the race for the assets of Santelisa Vale. GP has always been on the race, but São Martinho has only limited itself to informing it has always been alert to the opportunities of the market, through announcements made by spokespersons at the teleconference on its financial profits. Questioned, both the companies informed they would not make any announcements on the issue, but they have not denied the information on the negotiations. Besides informal proposals, all the interested people contracted companies to audit the company. The current stockholders have already talked to the interested people and, from Monday on, they begin the final process of sale of the assets, with the financial and administrative reorganization. In the conversations, the stockholders try to formalize a model through which the management and the share control will be diluted among the new stockholders, the current controlling stockholders, the Biagi and Junqueira families, and the BNDESPar, arm of Participations of the BNDES (National Development Bank), which would increase its share, currently at nearly 7% in Santelisa Vale, with a projected injection of R$ 500 million (US$ 217.4 million). With the purchase of part of the assets and the increase of the participation of the BNDES in the control, Santelisa Vale would reduce to nearly R$ 1.3 billion (US$ 565.2 million) its debt with creditors, which would be refinanced in eight years, with a grace period of three years. The end of the negotiations should take place at the same time of the beginning of the grinding of the 2009/2010 harvest and the production of sugar and alcohol, foreseen for April, according to Cícero Junqueira Franco, one of the stockholders of the company.