By Luciana Magalhaes
SAO PAULO, June 23 (Reuters) - Private equity firm IG4 is aiming to finalize a potential acquisition of Brazilian sugar and ethanol producer Raizen by the end of March 2027, pending a successful pitch to creditors, its top executives told Reuters on Monday.
IG4, which recently gained co-control of petrochemical firm Braskem, is now seeking to acquire control of Raizen following the producer's announcement of a 65 billion reais ($12.7 billion) debt restructuring agreement, a plan
that is set to be completed by the end of March.
IG4's pursuit of Raizen follows closely on the heels of its divestment of a controlling stake in Corredor Logistica e Infraestrutura (CLI) to AD Ports Group for $835 million, in partnership with Macquarie Group, underscoring the fund's growing focus on the agribusiness sector.
"We're turning our attention to the agro sector, which remains robust but is facing several difficulties," Helio Novaes, IG4's newly appointed chief executive, said.
According to Paulo Mattos, IG4 co-founder and chairman, the non-binding offer to Raizen's creditors provides some options, including a cash payment, as well as a choice for creditors who prefer to continue investing in Raizen by receiving quotas in an IG4 fund.
Mattos did not disclose the specific cash amount offered to creditors.
Last week, Reuters reported that independent investment bank Moelis & Company and financial consultancy Journey Capital, advisers to Raizen´s creditors, received a non-binding offer from IG4. Both declined to comment.
According to Mattos, IG4 has a track record of taking control or co-control of companies and believes that a turnaround is only effective with a majority stake. He also denied reports of investment bank BTG's involvement in the deal, clarifying that while BTG has invested in IG4's funds, it does not have a controlling or equity stake in the company.
The executives said that IG4's strategy does not involve hostile takeovers, but instead seeks to build support from creditors and stakeholders. If it is able to secure commitments from creditors and other stakeholders equivalent to 50% plus one of Raizen's shares, it will seek to negotiate with remaining major shareholders.
In a separate interview on Monday, Raizen Chairman Rubens Ometto was dismissive of IG4's bid, telling Reuters that it was just a rumor. "The financial market is full of creative ideas," he said.
IG4's growth, currently counting 40 professionals, and the divestment of CLI have created opportunities for new deals, Mattos and Novaes said.
The private equity management firm is focusing on investing in a smaller number of companies, targeting larger, complex, and global deals, they added.
($1 = 5.1398 reais)
(Reporting by Luciana Magalhaes; Editing by Stephen Coates)
