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Biosev renegotiates debt
The São Paulo offices of Norton Rose Fulbright and Dias Carneiro Advogados have helped sugar and ethanol producer Biosev renegotiate debt worth 3.6 billion reais (US$970 million) with several different lenders.
The deal involved six simultaneous negotiations with 11 financial institutions. The negotiations with a syndicate of banks formed by Crédit Agricole, Natixis, ING and Rabobank culminated in a US$219.8 million senior pre-export loan facility agreement (PPE). The banks are thought to have been represented by White & Case LLP in London, but this was not confirmed before publication.
In a separate negotiation, Santos Neto Advogados represented the banks in a syndicate formed by ING, BNP, Société Générale, Rabobank, Crédit Agricole and ABN AMRO. Those negotiations resulted in a US$512 million advances on export exchange contracts (ACC) facility.
In a bilateral negotiation, Bradesco, which is thought to have worked with White & Case, provided Biosev with a US$130.8 million credit line. Lobo de Rizzo Advogados advised Banco do Brasil on a seperate bilateral negotiation. Itaú and BTG Pactual also reached deals and are believed to have relied on in-house counsel.
The new credit agreements are governed under a mix of New York, English and Brazilian law.
As a precondition for the debt renegotiations, Biosev approved a capital increase of up to 4.79 billion reais (US$1.05 billion) through an issuance of ordinary shares at the price of 4.32 reais (US$ 1.15) per share. Dutch agriculture group Louis Dreyfus, which controls Biosev, subscribed to 800,752,314 shares in March, bailing out the company. Biosev and its controller are believed to have relied on in-house counsel for this operation.
The new credit deals closed on 6 June. Dias Carneiro’s partner Thiago Flores says the negotiations, which started in February, allowed Biosev to enhance its overall debt profile. “The challenging aspect is applying similar terms and conditions to simultaneous negotiations involving parties from different jurisdictions and based on legal instruments with particular structures,” says Flores.
Santos Neto’s Domicio Santos Neto says the range of separate multijurisdictional negotiations was challenging but that creditors established a set of principles and common requirements that were followed by all parties. “Since all deals followed the conditions established, the agreements could be reached in a simultaneous way,” he said. All Biosev’s creditors have agreed to extend the deadlines for their loans under a pari passu principle.
The second-largest sugar cane producer in the world – behind only Raízen – Biosev has been through financial difficulties since it listed on the Brazilian stock exchange in 2013, as the Financial Times reports. Earlier this month Biosev published a net loss of US$341 million in the 2017-2018 crop season. The company blames a revision in the value of its cane fields for the poor result.
In the senior pre-export loan facility (PPE)
Counsel to Biosev
In-house counsel – Daniela Aragão, Guilherme Tourino Brandi, Felipe Moraes de Azevedo
Norton Rose Fulbright
Partner Alison Baxter and associate Camilla Arno Sant’Anna in São Paulo
In the advances on export exchange contracts facility (ACC)
Counsel to Biosev
In-house counsel – Daniela Aragão, Guilherme Tourino Brandi, Felipe Moraes de Azevedo
Dias Carneiro Advogados
Partners Thiago Vallandro Flores and Gustavo Junqueira, counsel Paulo Leme and associate Murilo Balarin in São Paulo
Counsel to ING, SocGen, Rabobank, Natixis, ABN, BNP Paribas and Credit Agricole
Santos Neto Advogados
Partners Domicio dos Santos Neto and Gabriel Buscarini Leutewiler and associate Pedro Leão in São Paulo
In the bilateral negotiations with Banco do Brasil
Counsel to Biosev
In-house counsel – Daniela Aragão, Guilherme Tourino Brandi, Felipe Moraes de Azevedo
Dias Carneiro Advogados
Partners Thiago Vallandro Flores and Gustavo Junqueira, counsel Paulo Leme and associate Murilo Balarin in São Paulo
Counsel to Banco do Brasil
Lobo de Rizzo Advogados
Partner Fabrizio Sasdelli and associates Gustavo Cunha, Anna Piragibe and Maximiano Figueiredo in São Paulo
