BP Bunge Bioenergia Decides to Withdraw from the Sale of Its Plants After Reviewing Purchase Proposals Made by Mubadala and Raízen

BP Bunge Bioenergia, After Analyzing The Purchase Offers Made By Mubadala And Raízen, Decides To Discontinue The Sale Process Of Its Plants.

BP Bunge Bioenergia, which had been trying to negotiate its plants since mid-2022, decided to cancel the recent sale process due to a lack of “satisfactory” offers. The two companies that were still making purchase offers were Mubadala and the sugar-energy company Raízen. Although the outcome was not as desired, BP will continue its efforts to terminate its partnership with Bunge.

BP Bunge Bioenergia: Producer of Bioethanol, Sugar, and Renewable Energies

About The Decision To Sell The Plants

BP Bunge Bioenergia officially announced the sale of its plants in August 2022. Since October of the same year, BP Bunge had received two purchase proposals for its plants from Mubadala and Raízen.

However, before proceeding with the negotiations, BP and Bunge chose to wait for the presidential election to conclude before making a decision.

Bunge had previously attempted to divest its assets in the sugar and alcohol segment before establishing a stake in the joint venture with BP.

Despite declaring satisfaction with the performance of the operations, the assets in this segment were not assessed as essential for the overall strategy of their business.

Mubadala And Raízen’s Purchase Offers Are Rejected After Analysis And The Company Discontinues The Sale

Regarding the proposals made by the interested companies, the competitors work with different negotiation methods.

While the Mubadala fund presented its cash purchase offer, though with an amount below that stipulated by the controlling companies, Raízen opted to work with part cash and part exchange of shares, similar to Biosev’s purchase model in 2021.

Although Mubadala presented the best purchase offer, both options were deemed unsatisfactory for the interests of the joint venture, leading the company to cancel the sale process of its plants.

Despite the outcome, BP continues to intend to terminate the partnership with Bunge, contemplating alternatives that revolve around two possibilities: BP taking complete control of the company or even incorporating the joint venture into its biofuels department.

About BP Bunge Bioenergia

Established in December 2019, BP Bunge Bioenergia is a joint venture in bioenergy and sugar formed by the partnership between Bunge, an American multinational in the agribusiness sector, and BP, which operates in the energy sector.

The company combines agronomic techniques and technology applied in the field, ensuring high-precision agriculture, lower environmental impact, reduced costs, and increased performance in the production process of sugarcane, which is used as raw material for the production and sale of bioenergy and sugar.

Valued between R$ 9 billion and R$ 10 billion by JPMorgan, the joint venture has 11 agribusiness units distributed across 5 states, with an annual crushing capacity of up to 32.4 million tons of sugarcane.

In the 2021/2022 harvest, the company processed 23.5 million tons of sugarcane, produced 1.2 billion liters of ethanol, 1.2 million tons of sugar, and exported 1,000,581 MWh of bioelectricity to the National Interconnected System (SIN).

Even in the face of the COVID-19 pandemic in 2021, BP Bunge Bioenergia accumulated a gross revenue of R$ 7.8 billion and a net worth of R$ 5.2 billion.