Cosan Takes on Petrobras

With the purchase of Esso’s distribution assets, which include facilities that cater to retail, wholesale and aviation clients, the once lone sugarcane crushing mill Cosan is now set to take on some of Brazil’s biggest gasoline and ethanol retailers, including Petrobras. With the new assets, Cosan will have a more than 7% market share in Brazil. The sugar and ethanol company also gets Esso’s lubricants and specialty businesses, including a blending plant in Rio de Janeiro. And aside from Esso’s gas stations, Cosan will acquire 21 storage and distribution facilities. S&P placed Cosan’s outlook on negative yesterday following the announcement, citing uncertainties about the company’s plan to finance the deal. Cosan has roughly $870m in outstanding dollar debt, including a $450m perpetual and a $400m 2017 note.