Reuters logo
INTERVIEW-Pulpmaker Eldorado Brasil considering bond, equity debut
January 26, 2016 / 10:22 PM / in 2 years

INTERVIEW-Pulpmaker Eldorado Brasil considering bond, equity debut

(Adds earnings report for 2015, details on planned expansion)

By Priscila Jordão

SAO PAULO, Jan 26 (Reuters) - Eldorado Brasil SA, the pulp producer controlled by Brazil’s billionaire Batista family, is considering selling bonds or equity for the first time should market conditions turn favorable, Chief Executive Officer José Carlos Grubisich said on Tuesday.

While access to international debt markets this year looks “certain” for Eldorado because of strong demand for pulp worldwide and ongoing efforts to cut debt and costs, a listing in Brasil or any other major equity market ought not to be ruled out, Grubisich told Reuters in an interview.

He did not give a timetable for a potential transaction, though he hinted that either could take place as early as this year.

A bond offering would help the company replace costly debt with cheaper one with longer maturities, Grubisich said.

Management is working on regulatory, corporate governance and financial aspects to prepare Eldorado to tap capital markets, he added.

“Market liquidity poses no problem for us and global borrowing costs remain low,” he said. “The company exports and has a very competitive cost structure, one of the best in the world.”

Eldorado is part of J&F Investimentos SA, a holding company that groups the investments that the Batistas have outside JBS SA, the world’s largest meatpacker.

The company reported 1.87 billion reais ($461.43 million) in EBITDA last year and reduced the net debt/EBITDA ratio to 3.7 last year from 8 in 2014.

Grubisich said the Tres Lagoas unit expansion, that will more than double production capacity to 4 million tonnes a year, will be financed with a capital increase of around 3.5 billion reais and around 5 billion reais in debt. ($1 = 4.0526 Brazilian reais) (Additional reporting by Alberto Alerigi Jr, Tatiana Bautzer and Guillermo Parra-Bernal in São Paulo; Writing by Guillermo Parra-Bernal and Tatiana Bautzer; Editing by David Gregorio and Sandra Maler)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below