By Contributing Reporter
RIO DE JANEIRO, BRAZIL – The second largest ethanol producer in Brazil, Atvos, filed a petition for bankruptcy reorganization on Wednesday, May 29th. The company is a business unit of industrial conglomerate Odebrecht and was called Odebrecht Agroindustrial until 2017.
The request for protection from creditors came after U.S. fund manager Lone Star obtained an order from a Brazilian court to block Atvos’ cash position at the beginning of this week, according to Reuters.
In January, Odebrecht proposed the transfer of control of Atvos to creditors in Brazil in exchange for a reduction in the company’s R$12 (US$3) billion debt.
“This process is the result of the hostile onslaught by an international fund, a creditor of Atvos, which by means of a judicial proceeding put the company’s operations at risk,” Atvos affirmed by a note.
Once the court has accepted the petition for bankruptcy protection, the company will have 60 days to submit a recovery plan.
Atvos has been operating for 11 years and employs over 11,000 people, generating over 40,000 direct and indirect jobs.
In the 2019/2020 harvest, it should mill approximately 27 million tonnes of sugarcane.
The company operates in four states: São Paulo, Mato Grosso do Sul, Mato Grosso, and Goiás and owns nine agro-industrial units.
In addition to ethanol, the company produces sugar and energy generated from biomass. It is capable of milling 36 million tonnes of sugarcane and producing 3 billion liters of fuel and 700,000 tonnes of sugar.