Sources say Mercuria is moving closer to purchasing Raizen's Argentine assets worth over $1 billion.
By Luciana Magialhaes & Oliver Griffin
According to two sources familiar with the situation, Mercuria Energy Group is advancing in its bid to purchase a refinery in Argentina and hundreds of gas stations from Raizen, a Brazilian sugar and ethanol producer in financial trouble.
A source told us that the deal may be done soon, but there is still a chance it won't be. The signing of the agreement could be weeks away, according to a'second source.' She added that the transaction will likely exceed $1 billion. However, no binding agreement has been signed.
One of the two individuals said that Vitol, a global energy and commodities conglomerate, had previously sought to acquire?the assets?of?Raizen Argentina. However, talks with Mercuria progressed.
Mercuria Vitol and Raizen have not responded to our requests for comment.
Bloomberg was the first to report Mercuria's imminent deal to purchase Raizen assets in Argentina.
Raizen is a joint venture between Brazilian oil conglomerate Cosan, and London listed oil company Shell. It has suffered a string of heavy quarterly losses, and high levels of debt.
Two major credit rating agencies downgraded the company this week due to mounting financial pressure.
Fitch?cut Raizen's score to a 'B' at first, and then to a 'CCC+' the next day. S&P Global Ratings has downgraded Raizen from 'CCC+ to 'B'.
Raizen announced late Monday that it had appointed Pinheiro Neto, Cleary Gottlieb and Rothschild to serve as its legal and financial advisors. Reporting by Luciana Magnhaes and Oliver Griffin
(source: Reuters)