VREC focuses on acquisitions in Brazil and stars in sugarcane grinding to produce ethanol
Valor Econômico
Vital Renewable Energy Company (VREC), founded in 2008 by investment funds, starts in the 2011/12 harvest the grinding of sugarcane of its first plant in Brazil. Bom Sucesso, located in Goiás, should grind 1 million tons of sugarcane and only produce ethanol. The plant was acquired by VREC, in December, from the traditional Farias group. Investments of nearly US$ 250 million should be made in the coming years to increase the capacity of the plant to 3.5 million tons.
The company was established in 2008 to invest in bioenergy projects in the country. Right in the beginning it joined Grupo Farias - which has seven sugar and alcohol plants - in a project of four sugar and alcohol Greenfields in the States of São Paulo and Goiás. The projects were already being executed. The environmental and operating permits, and even part of the sugarcane crops had already been planted. However, according to sources of market, VREC wanted to accelerate its investments in the area and therefore it decided to invest in already operational assets.
With acquisitions on the radar, VREC also negotiates the purchase of other plants in the Mid-South, not necessarily of control, but also of minority interest, according to the same sources. According to Marco Falsarella, Officer of controllership of the Farias group, in negotiating with VREC, the company stayed with the project of a plant in Taquarituba (SP), which already has enough sugarcane planted to produce 500 thousand tons of raw materials. Currently, the group is in a fundraising stage to erect the plant, whose project foresees the grinding 3.5 million tons. "The project should demand R$ 200 million (US$ 117.6 million)", says Falsarella. The forecast, he says, is to begin the construction this year to put the unit into operation in 2012. The seven plants of the Farias group in operation have capacity to grind 12 million tons and are distributed through the States of São Paulo, Goiás, Acre, Pernambuco and Rio Grande do Norte.