Tereos Combines Brazilian, European, Asian Assets to Create Tereos Internacional Unit

With pro-forma 2009 annual sales of approximately US$2.5 billion, EBITDA of US$366 million, the newly created company will produce sugar, starch-based products and alcohol for the food and other industries and bioenergy (ethanol and electricity).

1 Apr 2010 --- Tereos Group has announced its intention to create Tereos Internacional, a global leader in food ingredients and bioenergy, by combining its Brazilian-listed subsidiary, Açucar Guarani (ACGU3) with Tereos Group’s European cereal assets (SYRAL, BENP, DVO and their subsidiaries) and its Indian Ocean sugarcane assets.

With pro-forma 2009 annual sales of approximately US$2.5 billion, EBITDA of US$366 million, the newly created company will produce sugar, starch-based products and alcohol for the food and other industries and bioenergy (ethanol and electricity).

In a clear demonstration of Tereos Group’s continued confidence in Brazil, Tereos Internacional will have its headquarters in Sao Paulo, Brazil. It will be headed by the CEO André Trucy, the former Managing Director of Rhodia in Brazil, and CEO of European starch producer Roquette.

Following the approval by Guarani’s shareholders of the merger of shares into Tereos Internacional (whereby Guarani will become a wholly-owned subsidiary), Tereos Internacional will apply for registration as a publicly-traded company in Brazil before the CVM, and of listing on BM&FBOVESPA (Novo Mercado), pursuant to applicable laws and regulations, thus preserving market liquidity for Guarani’s current shareholders. Tereos Internacional also contemplates a listing on NYSE Euronext in Paris.

Tereos Internacional contemplates raising new equity via an offering on both BM&FBOVESPA in Brazil and NYSE Euronext Paris in France following the completion of the corporate reorganization and Tereos Internacional’s registration as a publicly-traded company, and subject to market conditions.

The step-change in scale resulting from this combination will enable Tereos Internacional to play a leading role in the sugar, starch and bioenergy industries. With sales in more than 100 countries, Tereos Internacional will leverage its broad geographical footprint to serve global customers in the food and beverage, energy, animal nutrition, pharmaceutical and other industries as they expand internationally. The strategic combination will give Tereos Internacional a foothold in both developed and emerging markets while providing it with the improved financial structure and capacity to seize growth opportunities including in new products, such as health & nutrition and green chemistry, and in fast-growing countries in the Americas and Asia.

Tereos Group has been a long-standing supportive shareholder of Guarani (with an approximately 69% shareholding) and intends to remain the majority shareholder of Tereos Internacional. Tereos Internacional will be its sole global investment vehicle for diversification outside its historical European beet sugar business.

Philippe Duval, Chairman of Tereos’s Executive Board, commented: “Over the past decade, Tereos has become a major player in the sugar and ethanol industry in Brazil and the starch business in Europe. Today, by combining these activities in a new company that will have strong presence in Brazil and in Europe, we are taking a decisive new step to accelerate our growth strategy. This combination will allow us to be a key actor in the rapidly-consolidating food ingredients and bio-energy industries and will position us to be able to conquer new markets.”