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J&F Investimentos Reportedly to Sell Eldorado Brasil Celulose Shares to Paper Excellence

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According to a report this week by EUWID Pulp and Paper, Pulp producer Eldorado Brasil Celulose, Brazil, informed its shareholders in a Sept. 2, 2017, market announcement that its major shareholder, J&F Investmentos, has agreed to sell its entire stake in the company to CA Investment S.A., a subsidiary of Paper Excellence.

The EUWID report notes that, according to Eldorado, the purchase price for the company amounts to BRL15 billion (EUR 4 billion), adjusted for working capital and net financial debt at completion. As the EUWID report points out, J&F Investmentos holds an 81% stake in Eldorado Brasil Celulose, according to information on Eldorado's website. The remaining 19% is owned by the pension funds Petros and Funcef, and the private equity fund FIP Olimpia. 

Eldorado operates one pulp mill in Três Lagoas with an installed production capacity of 1.7 million metric tpy of bleached eucalyptus kraft (BEK) pulp. The company is set to increase its production capacity to more than 4 million metric tpy by installing a new BEK pulp line. The startup date of the new 2.5 million metric tpy pulp production line has been postponed from the first half of 2018 to 2020.

Paper Excellence runs pulp mills in Canada and France offering a total production capacity of 2.3 million metric tpy. The company is affiliated with Indonesia's industry conglomerate the Sinar Mas Group and its pulp and paper subsidiary Asia Pulp and Paper (APP). 

As reported in this past week’s (Aug. 31, 2017) Over the Wire newsletter, Asia Pulp & Paper and its parent Sinar Mas Group strongly denied they were planning to buy Eldorado Brasil Celulose, which was up for sale after its controlling shareholders got ensnared in Brazil's worst corruption probe.

 

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