Albioma acquires 65% stake in Codora Energia

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Albioma acquires 65% stake in Codora Energia

Albioma has signed final documentation relating to the acquisition of a 65% equity interest in Codora Energia, a 48 MW bagasse-fuelled cogeneration plant in the Brazilian state of Goiás, from Jalles Machado group.

The plant, commissioned in 2011, backs onto a distillery that currently processes 1.6 million tonnes of sugarcane annually.The plant, which currently injects 98 GWh of electricity to the power grid, benefits from a long-term power purchase agreement (guaranteed until 2026) covering the injection of 87 GWh/year at an attractive, inflation-indexed price of BRL 205 per MWh.

Harnessing Albioma's industrial expertise to improve energy efficiency, gradually increasing the volume of sugarcane processed by the distillery to 2.1 million tonnes per year and, in the medium term, adding a third 20 MW combustion turbine and burning sugarcane chaff should enable electricity exports to be increased from their current level to more than 170 GWh.

This acquisition will be financed by a combination of local debt (50%), including a BRL39 million (US$12.8 million) BNDES line, and shareholders' equity (50%).

Albioma will own a 65 % equity interest in Codora Energia; the Jalles Machado group will retain the remaining 35 %. Finalisation of the agreement is subject to conditions precedent, which are expected to be resolved during the second half of 2015.

Jacques Pétry, Chairman and Managing Director, announced:

"We are delighted with this new success, which vindicates our strategy to make Brazil our top international priority. Together, Albioma and Jalles Machado will form a strong, well-balanced partnership, combining the Jalles Machado group's strong position as a leader in the Brazilian sugar and ethanol industry with Albioma's expertise in high-efficiency recovery of bagasse, a key biomass resource in Brazil. We are more than happy for our Brazilian partner to retain a 35 % stake in Codora Energia, which ensures that the long-term interests of the two parties are aligned. "

"Our first Brazilian plant, Rio Pardo, delivered very strong industrial and economic performance in 2014. The Codora project is also expected to make a positive contribution to Group performance from its first year of operation by Albioma."

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