Chinese commodities trader COFCO has asked to participate in an auction in Brazil where a sugar mill owned by India`s Shree Renuka Sugars Ltd will be sold as part of an in-court debt restructuring, according to court documents seen by Reuters on Tuesday.
COFCO already owns four sugar and ethanol plants in Brazil capable of processing a combined 15 million tonnes of cane per year. The company looked at other potential targets last year, but said prices were too high.
Renuka, which is under bankruptcy protection, will sell its Revati mill in the municipality of Brejo Alegre in Sao Paulo state. The plant, which is near COFCO`s Sao Paulo operations, has capacity to process 4 million tonnes of cane per year. The auction is scheduled for Sept. 4.
If successful, it would be the third sale of sugar and ethanol plants in Brazil through judicial auctions in less than a year, as players with stronger capital structure snap up the assets of heavily indebted rivals.
Glencore Plc bought the Guararapes mill in November from distressed sugar group Unialco. Raízen Energia SA, a 50-50 joint venture between Cosan SA Industria e Comercio and Royal Dutch Shell Plc, acquired two mills from Tonon Bioenergia SA in June.
According to the court documents seen by Reuters, Brazilian sugar firm Companhia Mineira de Açúcar e Álcool (CMAA), which owns two mills in Minas Gerais state, has also asked to take part in the auction. Last year CMAA acquired the Vale do Pontal mill from U.S.-based Archer Daniels Midland.
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