Acquisition of Maeda S.A. Agroindustrial
Company description: an important Brazilian producer of grains and other agricultural crops, with more than 80 years in the industry, pioneer in the development of new agricultural frontiers and land development
Our analysis: company in need of a capital restructure, due to prioir investments that costed financial leverage, cash and working capital, which impacted company in its operational results for two consecutive years
Investment thesis: with favorable perspectives for the Brazilian agribusiness and a solid base of Maeda's assets, a debt restructuring combined with severe measures on the operational restructuring process could rebalance the company. The reorganized company could be sold to other national or international strategic players
Highlights of Arion's approach:
Hands-on management: 50% reduction in G&A in the short-term, sale of non-operating assets; revision of agricultural planning, development and implementation of a budget process, and execution of hedging practices to protect operating results and margin of the crop
Financial restructuring: Capital injection for working capital needs, restructuring of debt and covenants and guarantees with banks and suppliers, and raise of new debt with banks
Exit: Merge with Brasil Ecodiesel, important listed company in biodiesel production segment
