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BNDES and Votorantim conclude negotiation for consolidation of Suzano with Fibria

03/16/2018

 The resulting company will be the leader in the pulp market in the world

The payment to BNDESPAR encompasses a significant portion in cash (about R$ 8.5 billion) and in shares of the new company, with prospects of appreciation

 

The Brazilian Development Bank (BNDES), through its shareholdings subsidiary, BNDESPAR, approved the consolidation between the companies Suzano and Fibria. The negotiations were conducted in agreement with Votorantim S.A., with which BNDESPAR shares the control of Fibria. 

The operation consolidates the two largest companies of pulp in Brazil, and transforms the resulting company into the world leader in the pulp market. The composition of the payment to BNDES encompasses the receiving of a significant part in money, about R$8.5 billion, and the remainder in the shares of the resulting company, with prospects of appreciation from the synergic and productivity gains derived from the transaction.

The operation secured the strengthening of the capital market, in accordance with BNDES’s mission, and maintained an open company in the Brazilian market. Improvements to governance were also negotiated, including the adoption of a policy of appointment of independent directors. The resulting company should, by contract, at least maintain the same standard of social and environmental responsibility which the two companies were already recognized for.

The negotiating process, in accordance with the best practices of corporate governance, also ensured that minority shareholders receive money and shares under the same conditions of controllers. 

BNDESPAR will maintain its relevant share in the resulting company, but will be a minority shareholder. In this way, BNDES resumes its corporate strategy of monetization of mature shareholdings in large enterprises at appropriate prices, allowing the generation of cash for new investments in funds of support to startups and scale-ups, among others.

The operation is fully ensured by a consortium of private banks and its conclusion is subject to approval from antitrust agencies.

History – The end of negotiations concludes the successful cycle of BNDESPAR’s share in Fibria, which began in 2009, with contribution of capital for the creation of the company resulting from the combination of Votorantim Celulose e Papel and Aracruz Celulose. 

Since then, Fibria obtained results in several dimensions, from the strengthening of governance practices — notably the migration to the New Market —, the reinforcement of its capital structure and the obtaining of the credit rating.

The shares prepared the company for a cycle of expansion that resulted in the strengthening of the national pulp industry and generated an increase in exports, with impacts on the trade balance and on the generation of jobs.

 

 
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