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Raizen Secures 80% Creditor Support for Record Debt Restructuring, Plans Split into Two Companies
Raízen, the joint venture between oil major Shell and Brazilian conglomerate Cosan, announced that it has secured the backing of roughly 80 % of its creditors for a debt‑restructuring plan that covers about R$64.7 billion (US$12.8 billion). The agreement, the largest out‑of‑court restructuring in Brazil, will convert a significant portion of the debt into equity, dilute Cosan’s ownership stake, and split the company into separate fuel‑distribution and sugar‑ethanol‑bioenergy units by 2027.
The restructuring plan was approved by creditors in a meeting held on 3 June 2026. The 80 % threshold moves the process from negotiation to a near‑finalised state, allowing creditors to exchange debt for shares and become majority owners of the restructured entity.
Under the terms, Cosan’s stake in Raízen will be reduced to a small fraction while Shell will become the dominant shareholder. Shell has committed R$3.5 billion (US$692 million) in fresh capital, and a vehicle linked to Cosan’s controlling family can contribute up to R$500 million more on the same terms. The additional cash is intended to strengthen the company’s balance sheet as it transitions to the new structure.
A key feature of the plan is the planned split of Raízen into two separate companies by 2027. One entity will hold the fuel‑distribution network, including the 7,000‑plus Shell‑branded stations across Brazil and Argentina, while the other will retain the sugar, ethanol, and bioenergy operations that originated from Cosan’s assets. The split is designed to make each unit easier to value, manage, and potentially sell to new investors.
Raízen’s operations will continue unchanged during the restructuring. The company remains a major player in Brazil’s sugar and ethanol market and a significant fuel distributor. The restructuring does not affect day‑to‑day fuel sales or sugar production, and the company is expected to maintain its current output levels.
The restructuring reflects the broader challenge of high debt levels in Brazil’s corporate sector. Raízen’s debt burden grew during a period of rapid expansion, and the rise in global interest rates has increased the cost of servicing that debt. The plan is an attempt to reduce leverage and align the company’s capital structure with current market conditions.
A São Paulo court still needs to approve the restructuring plan. The court approval is expected in the coming months, after which the new debt and equity allocations will be formally handed over to creditors. Following court approval, the company will begin implementing the plan’s conditions, a process that will extend into 2027.
The restructuring is the largest out‑of‑court debt reorganisation in Brazil’s history. It follows a trend of Brazilian firms seeking extrajudicial recovery mechanisms to address large unsecured debt portfolios. According to industry data, the total amount of debt being renegotiated through such mechanisms reached R$103.3 billion in 2026.
The plan’s approval also has implications for the energy and commodity markets. Raízen’s sugar and ethanol output influences global prices for these commodities, and any disruption could affect international markets. However, the company’s continued operations suggest that the restructuring will not immediately impact supply.
The restructuring is still subject to regulatory review. The Brazilian Securities and Exchange Commission (CVM) and other regulators will monitor the plan’s implementation. Investors and analysts will watch the court’s decision and the company’s progress toward the 2027 split.
In summary, Raízen has secured 80 % creditor support for a record debt‑restructuring plan that will convert debt into equity, dilute Cosan’s ownership, inject fresh capital from Shell and the Cosan family, and split the company into two distinct units by 2027. The plan requires court approval and will be implemented over the next few years. The restructuring reflects the broader challenges of high debt and rising interest rates in Brazil’s corporate sector.
The restructuring plan was approved by creditors in a meeting held on 3 June 2026. The 80 % threshold moves the process from negotiation to a near‑finalised state, allowing creditors to exchange debt for shares and become majority owners of the restructured entity.
Under the terms, Cosan’s stake in Raízen will be reduced to a small fraction while Shell will become the dominant shareholder. Shell has committed R$3.5 billion (US$692 million) in fresh capital, and a vehicle linked to Cosan’s controlling family can contribute up to R$500 million more on the same terms. The additional cash is intended to strengthen the company’s balance sheet as it transitions to the new structure.
A key feature of the plan is the planned split of Raízen into two separate companies by 2027. One entity will hold the fuel‑distribution network, including the 7,000‑plus Shell‑branded stations across Brazil and Argentina, while the other will retain the sugar, ethanol, and bioenergy operations that originated from Cosan’s assets. The split is designed to make each unit easier to value, manage, and potentially sell to new investors.
Raízen’s operations will continue unchanged during the restructuring. The company remains a major player in Brazil’s sugar and ethanol market and a significant fuel distributor. The restructuring does not affect day‑to‑day fuel sales or sugar production, and the company is expected to maintain its current output levels.
The restructuring reflects the broader challenge of high debt levels in Brazil’s corporate sector. Raízen’s debt burden grew during a period of rapid expansion, and the rise in global interest rates has increased the cost of servicing that debt. The plan is an attempt to reduce leverage and align the company’s capital structure with current market conditions.
A São Paulo court still needs to approve the restructuring plan. The court approval is expected in the coming months, after which the new debt and equity allocations will be formally handed over to creditors. Following court approval, the company will begin implementing the plan’s conditions, a process that will extend into 2027.
The restructuring is the largest out‑of‑court debt reorganisation in Brazil’s history. It follows a trend of Brazilian firms seeking extrajudicial recovery mechanisms to address large unsecured debt portfolios. According to industry data, the total amount of debt being renegotiated through such mechanisms reached R$103.3 billion in 2026.
The plan’s approval also has implications for the energy and commodity markets. Raízen’s sugar and ethanol output influences global prices for these commodities, and any disruption could affect international markets. However, the company’s continued operations suggest that the restructuring will not immediately impact supply.
The restructuring is still subject to regulatory review. The Brazilian Securities and Exchange Commission (CVM) and other regulators will monitor the plan’s implementation. Investors and analysts will watch the court’s decision and the company’s progress toward the 2027 split.
In summary, Raízen has secured 80 % creditor support for a record debt‑restructuring plan that will convert debt into equity, dilute Cosan’s ownership, inject fresh capital from Shell and the Cosan family, and split the company into two distinct units by 2027. The plan requires court approval and will be implemented over the next few years. The restructuring reflects the broader challenges of high debt and rising interest rates in Brazil’s corporate sector.
