Investment

Brazil's Cosan seeks investment opportunities -CFO

Cosan Ltd, the holding company that controls Brazil's No. 1 sugar and ethanol producer, is looking for opportunities to invest in the country's energy and infrastructure sectors

Reuters
16/04/2015 19:19
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Cosan Ltd, the holding company that controls Brazil's No. 1 sugar and ethanol producer, is looking for opportunities to invest in the country's energy and infrastructure sectors, Chief Financial Officer Marcelo Martins said on Wednesday.

 

An economic downturn and rising borrowing costs in Brazil have forced Cosan to build up cash, which now allows it to consider more investments in those industries, Martins said at an event sponsored by Fitch Ratings.

 

His remarks come as companies in oil and gas, fuel distribution, and infrastructure services are disposing of assets to cope with a challenging economic outlook and, in some cases, to deal with fallout from a massive corruption probe at Petroleo Brasileiro SA.

 

Petrobras, as the state-run oil company is known, is considering selling part of its fuel distribution unit to raise cash as the scandal prevents it from accessing capital markets, Reuters reported last month.

 

Martins said Royal Dutch Shell Plc's offer to buy smaller rival BG Group, the first major energy industry merger in more than a decade, proved Cosan's decision to diversify into energy made sense.

 

"The focus (at Cosan) is on liquidity, which is to protect the company, but that focus can only be good if we are prepared and ready to seize good opportunities ahead," Martins said.

 

Cosan's return on invested capital has grown rapidly in recent years, signaling that the decision to expand outside sugar and ethanol was "the correct one," Martins noted.

 

The company and Shell are partners in Raizen Energia SA, one of Brazil's largest fuel distribution groups.

 

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