Copersucar buys out Cargill’s share in Alvean and becomes its sole owner

Published 2021년 4월 6일

Copersucar agrees to buy out Cargill’s share in the Alvean joint venture on March 30th and become its sole owner. The deal was agreed for an undisclosed amount and awaits approval from the Brazilian antitrust agency to be finalized. Cargill stepping out is part of a portfolio review. Copersucar will maintain the Alvean brand and keep independent management in Alvean.

On March 30th, Cargill announced that it has agreed to sell 50% of the joint venture Alvean to its Brazilian partner Copersucar. Alvean is the world’s largest sugar trader, responsible for handling around 12 million MT of sugar annually, representing 20% of the global sugar trade from 2019/20 crop. With the deal, Copersucar becomes the sole owner of the sugar giant. Rumors on the negotiations started back in early January this year.

Copersucar stated that it would pay for the transaction in cash from its reserves, but either company did not reveal the deal details. The transaction and its financial terms are being reviewed and await approval by the Brazilian antitrust agency, CADE.

Cargill stated that the joint venture’s exit is part of its plan to focus on food and agriculture businesses, especially food processing and meat production operations. The company also stated that it would continue to supply sugar ingredients to ongoing deals through existing operations in Brazil, the US, and Mexico.

Copersucar stated that Alvean would still be managed independently from its governance structure even after the deal’s conclusion. The brand will be kept, and it will keep its activities and global presence as it is.

According to a source in Copersucar, the company is comfortable managing Alvean on its own. Still, they are open to evaluating a partner’s possibility in the future that will strengthen the business, bringing even more efficiency to operations. However, there are no ongoing talks about the opportunity at the moment.

Companies stepping away from sugar

Cargill is not the first company to step away from its sugar business. Several other major companies have stepped away from the sugar industries in recent years as super sugarcane crops have stabilized their prices down and less lucrative for years, making the segment less appealing to traders.

Sugar price trend