Aug 10, 2011 - The board of directors of biofuel maker Brasil Ecodiesel (SAO:ECOD3) yesterday approved the acquisition of local agricultural company Vanguarda Participacoes SA, for BRL 1.1 billion (USD 692.3m/EUR 481.1m) in shares, Brasil Ecodiesel said in a regulatory filing.
In April, Brasil Ecodiesel had received a proposal from the shareholders of Vanguarda for the incorporation of 100% of the shares of the latter, in a deal worth BRL 1.2 billion. In May, Brasil Ecodiesel informed that it had turned down the proposal.
The rejection was provoked by disputes among the shareholders of the biodiesel maker related to the fact that Spanish tycoon Henrique Banuelos, owner of the Veremonte do Brasil investment fund, had indirect interest in both Vanguarda and Brasil Ecodiesel. Last month, Banuelos completed the sale of his stake in Brasil Ecodiesel, paving the way to the proposed merger.
Vanguarda, a producer of soy, cotton and maize, was founded by Otaviano Pivetta in 1983 and at present owns 10 production units in western Mato Grosso state and one in northeastern Bahia state, situated on approximately 226,000 ha (558,458 acres) of land.
The merger is still subject to approval by the two companies' shareholders. If completed, it will create one of the largest agricultural groups in Brazil, resulting into synergy gains for Brasil Ecodiesel and diversification of its business.
(BRL 1.0 = USD 0.629/EUR 0.437)
Choose your newsletter by Renewables Now. Join for free!