Shree Renuka Sugars Ltd has informed the exchanges that it has acquired Brazilian sugar and ethanol producer Vale Do Ivai S.A. Acucar E Alcool for $82 million besides debt assumption, which is likely to be repaid over eight years. The total enterprise value of the acquired company is $240 million..
India's biggest sugar refiner will get two sugar and ethanol production facilities, which will have a cane crushing capacity of 3.1 million tonnes per annum. Brazil is the largest sugar producer and exporter, and the deal will give Renuka Sugars an entry into this market.
The acquisition will help Shree Renuka secure requirement of raw-sugar to feed its mills and comes as another piece of intense competition among the top sugar firms in the country. Shree Renuka's close rival Bajaj Hindusthan has been looking to sew a deal to acquire the third largest domestic player Balrampur Chini. The proposed domestic deal is officially off even as there are reports that Bajaj Hindusthan is still pursuing the transaction.
The shares of Renuka Sugars shot up by more than 3% to Rs 220.85 before coming down to Rs 217.5.