FORM
6-K
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Report
of Foreign Issuer
Pursuant
to Rule 13a-16 or 15d-16
of
the Securities Exchange Act of 1934
For the
month of June 2009
Commission
File Number: 1-33659
COSAN
LIMITED
(Translation
of registrant’s name into English)
Av.
Juscelino Kubitschek, 1726 – 6th
floor
São
Paulo, SP 04543-000 Brazil
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F:
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Form
20-F
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X
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Form
40-F
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Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1):
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Yes
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No
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X
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Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(7):
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Yes
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No
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X
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Indicate
by check mark whether by furnishing the information contained in this Form, the
Registrant is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
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Yes
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No
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X
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If “Yes”
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): N/A
COSAN
LIMITED
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Item
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1.
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Minutes of the Fiscal Council Meeting
of Cosan S.A.
Indústria e
Comércio held
on June 1,
2009
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2.
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Minutes of the Board of Directors’ Meeting of Cosan S.A. Indústria e Comércio held on June 1,
2009
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3.
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Call
Notice for Extraordinary Shareholders’ Meeting of Cosan S.A. Indústria e
Comércio to be held on June 18, 2009
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4.
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Material
Fact of Cosan S.A. Indústria e Comércio dated June 2,
2009
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5.
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Protocol
and Justification of Merger of Curupay S.A. Participações into Cosan S.A.
Indústria e Comércio
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
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COSAN
LIMITED
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Date:
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June 5,
2009
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By:
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/s/
Marcelo Eduardo Martins
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Name:
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Marcelo
Eduardo Martins
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Title:
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Chief
Financial and Investor Relations Officer
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ITEM
1
COSAN S.A. INDÚSTRIA E
COMÉRCIO
Corporate Taxpayers' ID
(CNPJ): No. 50.746.577/0001-15
Company Registry (NIRE)
35.300.177.045
Minutes of the Fiscal
Council Meeting held on June 1, 2009.
Date,
time and venue: June 1, 2009 at 10:00 am, at the Company´s headquarters
at Avenida Juscelino Kubitscheck, 1.726, 6º andar, in the city and state of São
Paulo. Attendance:
All members of the Company´s Fiscal Council: João Ricardo Ducatti, Luiz Cláudio
Gomes Recchia and
Ademir José Scarpin. Presiding:
Chairman – João Ricardo Ducatti; Secretary – Ademir José Scarpin. Agenda:
To discuss the merger of Curupay S.A. Participações by Cosan S.A. Indústria e
Comércio. Resolutions: After
carefully analyzing the Protocol and Justification of Merger of Curupay S.A.
Participações and the associated evaluation reports prepared by Deloitte Touche
Tohmatsu Auditores Independentes and Banco de Investimentos Credit Suisse
(Brasil) S.A., the members of the Fiscal Council, in accordance with item III of
article 163 and paragraph 2 of article 166 of law No. 6.404/76, recommended its
submission to a Shareholders Meeting. Closure
and approval of the minutes: There being
no further matters to address, the meeting was called to order and the present
minutes were drawn up, read, approved and signed by all members of the Fiscal
Council.
São Paulo, June
1st,
2009.
______________________________________
JOÃO RICARDO
DUCATTI
______________________________________
ADEMIR JOSÉ
SCARPIN
______________________________________
LUIZ CLÁUDIO
GOMES RECCHIA
ITEM
2
COSAN
S.A. INDÚSTRIA E COMÉRCIO
Corporate
Taxpayer’s ID (CNPJ) 50.746.577/0001-15
Company
Registry ID (NIRE) 35.300.177.045
PUBLICLY-HELD
COMPANY
MINUTES
OF THE BOARD OF DIRECTORS’ MEETING
HELD
ON JUNE 01, 2009
1. DATE,
TIME AND PLACE: June 1, 2009, at 9:00 am, at the Company’s administrative
office located at Avenida Juscelino Kubitschek, 1726, 6º andar, in the city and
state of São Paulo.
2. ATTENDANCE:
All members of the Company’s Board of Directors attended the meeting, namely:
Mr. Rubens
Ometto Silveira Mello, Chairman of the Board of Directors, Mr. Pedro Isamu
Mizutani, Vice Chairman of the Board of Directors, Mr. Burkhard
Otto Cordes, Mr. Marcus
Vinícius Pratini de Moraes, Mr. Serge
Varsano (representing Mr. Rubens
Ometto Silveira Mello by proxy), Mr. Maílson
Ferreira da Nóbrega, Mr. Sylvio
Ricardo Pereira de Castro and Mr. Pedro Luiz
Cerize. The following members of the Fiscal Council also attended the
meeting: Mr. João
Ricardo Ducatti, Mr. Luiz
Cláudio Gomes Recchia and Mr. Ademir José
Scarpin. All members attended the meeting by conference call, as provided
for in paragraph 2 of Article 20 of the Company’s Bylaws, except for the Fiscal
Council members, who attended the meeting exclusively for consideration of item
I. (iii).
3. CALL
NOTICE: Sent by e-mail and waved in view of the presence of all
members.
4. PRESIDING
BOARD: Chairman: Rubens Ometto
Silveira Mello; Secretary: Marcelo de Souza
Scarcela Portela.
5. AGENDA:
I. Discussion and
resolution on the corporate reorganization proposed by the Board of Executive
Officers, which shall result in the merger of the companies of the Nova America
group; a) Authorization
for the Company to sign the Private Instrument of 2nd
Addendum to the Deed of the 2nd Public
Issue of Simple Debentures, of unsecured type, of Nova América S.A. –
Agroenergia with Rezende Barbosa S.A. Administração e Participações and others;
b) Assumption of all
sureties and aval guarantees of debts with various financial institutions
contracted by the companies: Nova América S.A. Agroenergia; América Trading
S.A., Teaçu Armazéns Gerais S.A., Nova América S.A. Trading and Destilaria
Paraguaçu Ltda.; c)
Approval of the signature of the “Protocol and Justification”, as well as all
articles of association and documents related to the merger by the Company of
Curupay S.A. Participações, a company controlled by Rezende Barbosa S.A.
Administração e Participações and controlling company of Nova América S.A.
Agroenergia; d) Approval
of the call to competent Extraordinary Shareholders’ Meeting. II. Discussion and resolution
on the ratification of the management’s actions that resulted in the sale of the
aviation business to Shell; III. Offering of assets as
guarantee: authorization for the Company to offer as guarantee of loans
contracted by the Company or any of its controlled companies, or as judicial
guarantee in execution suits filed against the Company or any of its controlled
companies, any of its assets, including, but not limited to, the following
Industrial Complexes, as well as the respective rural areas where these
Industrial Complexes are located: São Francisco Unit, located at Fazenda
Sobrado, in Elias Fausto (SP); Santa Helena Unit, located at Bairro Campestre,
in Rio das Pedras (SP); Costa Pint Unit, located at Bairro Costa Pinto, in
Piracicaba (SP); Diamante Unit, located at Fazenda São José, district of
Potunduva, Jaú (SP); Rafard Unit, located on Rua do Engenho, in Rafard (SP);
Serra Unit, located at Fazenda da Serra, in Ibaté (SP), Junqueira Unit, located
at Estação Coronel Quito, in Igarapava (SP); Mundial Unit, located on Estrada
Mirandópolis/Pacaembu, in Mirandópolis (SP); and Bom Retiro Unit, located at
Fazenda Bom Retiro, in Capivari (SP).
6. RESOLUTIONS: After the discussion of the matters in
the agenda, the members of the Board of Directors resolved, by unanimous vote,
without any restriction:
I.
Corporate Restructuring
(i) to authorize
the Company to sign the Private Instrument of 2nd
Addendum to the Deed of the 2nd Public
Issue of Simple Debentures, of unsecured type, of Nova América S.A. –
Agroenergia with Rezende Barbosa S.A. Administração e Participações and others,
as addendum made on September 21, 2008 (“2º Aditamento”), to be signed on this
date, in which the Company is depicted as the new
intervenor-obligor;
(ii) to assume all
sureties and aval guarantees of debts with various financial institutions
contracted by the companies: Nova América S.A. Agroenergia; América Trading
S.A., Teaçu Armazéns Gerais S.A., Nova América S.A. Trading and Destilaria
Paraguaçu Ltda “Nova América”), which shall become controlled by the Company
after the corporate reorganization, in the amount of approximately
R$1,200,000,000.00, on April 30, 2009;
(iii) to
approve the signature of the “Protocol and Justification”, as well as all
documents related to the operations aimed at corporate reorganization and the
calling of general shareholders’ meeting to resolve on this subject, all
documents shall be signed by the Company’s management, which provides for the
merger by this Company of Curupay S.A. Participações, a company controlled by
Rezende Barbosa S.A. Administração e Participações and controlling company of
Nova América;
(iv) to approve the
calling of Extraordinary Shareholders’ Meeting to resolve on the corporate
reorganization aforementioned.
II.
Sale of the aviation business to Shell Brasil Ltda.
(iv) to ratify all
the actions of the management of the Company and its subsidiaries, as follows,
related to the sale of aviation assets to Shell Brasil Ltda., which include the
contribution, by Cosan Combustíveis e Lubrificantes S.A. (“CCL”), of assets
listed and evaluated pursuant to the evaluation report included in the minutes
of the Board of Directors’ meeting of CCL held on May 20, 2009 and registered at
JUCERJA, to the capital of Jacta Participações S.A., a corporation headquartered
in the City of Piracicaba, State of São Palo, at the access to Bairro Costa
Pinto, s/nº, Casa Sede, Sala 7, CEP 13411-900, Corporate Taxpayer’s ID
(CNPJ/MF)
no.
10.795.274/0001-78; and authorize Cosanpar Participações S.A. to vote for the
redemption of CCL’s shares on the delivery of the totality of shares issued by
Jacta Participações S.A., which has already been approved by CCL’s Extraordinary
General Meeting held on April 30, 2009, minutes already approved at
JUCERJA.
III.
Offer of assets as Collateral
(v) to authorize
collaterals and/or indications to pledge of the abovementioned assets, within
the limits of the authorization herein.
7. Closure: There being no further
business to discuss, the meeting was adjourned by the Chairman and were drawn
up, read, declared accurate and signed by all shareholders.
This is a free
English translation of the original instrument drawn up in the Company’s
records.
São Paulo, June 1,
2009.
Marcelo
de Souza Scarcela Portela
Secretary
ITEM
3
COSAN S.A. INDÚSTRIA E COMÉRCIO
Corporate Taxpayers ID (CNPJ/MF):
50.746.577/0001-15
Company Registry (NIRE):
35300177045
Publicly Held
Company
Call Notice
Extraordinary Shareholders' Meeting
Shareholders
are hereby invited to attend the Extraordinary
Shareholders’ Meeting
of Cosan S.A. Indústria
e Comércio
(“Company”), to
be held on June 18, 2009, at 11:00 a.m., at the Company’s
headquarters, in Bairro Costa Pinto, s/nº,
Piracicaba, state of São
Paulo, to resolve on the following agenda: (a) to examine,
discuss and approve the Protocol and Justification of Merger of Curupay
Participações
S.A. by the Company; (b) to ratify the appointment and hiring of Deloitte Touche
Tohmatsu Auditores Independentes as the firm responsible for preparing the
evaluation
of Curupay Participações
S.A.’s
Shareholders’ Equity;
(c) to approve the evaluation report referred to in the above-mentioned item
“b”; (d)
to resolve on the merger of Curupay Participações
S.A. by the Company and the consequent capital increase through
the issue of common shares to Rezende Barbosa S.A. Administração e
Participações,
the sole shareholder of Curupay Participações
S.A., by virtue of said merger, and the consequent amendment to the caput of
Article 5 of the Company’s
Bylaws; and (e) to authorize
the Company’s
management to take all the necessary measures for to implement said merger,
should it be approved.
General
Instructions: In order to take part in and vote at the Shareholders’ Meeting,
shareholders should confirm their status as such by
presenting, at the Company’s
headquarters at least 2 (two) days before the date of the Meeting, an identity
document and a statement of shareholdings issued by the depository institution
(Banco Itaú S.A.
or the CBLC – Brazilian
Clearing and Depository Institution)
in the original or in the form of a copy sent by facsimile to (19) 3403-2030.
Shareholders represented by proxies should present the respective powers of
attorney within the same term and in the same manner mentioned above. Neither
originals nor copies of said
documents
require authentication and notarization of signature, should be presented to the
Company on or before the opening of the aforementioned
Meeting.
The
documents pertaining to the matters on the Agenda have been duly submitted
to the
BM&FBovespa S.A. (São
Paulo Paulo Stock, Futures and Commodities Exchange) pursuant to article 124,
paragraph 6 of the Brazilian Corporation Law, and are available to shareholders
as of today on the Company’s
website.
Piracicaba
(SP), June 2, 2009.
RUBENS
OMETTO SILVEIRA MELLO
Chairman
of the Board of Directors
| ITEM 4 |
 |
 |
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COSAN
S.A. INDÚSTRIA E COMÉRCIO
Corporate
Taxpayer’s ID (CNPJ/MF) 50.746.577/0001-15
Corporate
Registry ID (NIRE) 35.300.177.045
|
NOVA
AMÉRICA S.A. AGROENERGIA
Corporate
Taxpayer’s ID (CNPJ/MF) 62.092.739/0001-28
Corporate
Registry ID (NIRE) 35.300.127.242
|
Material
Fact
COSAN S.A. INDÚSTRIA E
COMÉRCIO (“COSAN”, Bovespa:
CSAN3) and NOVA AMÉRICA S.A.
AGROENERGIA (“NAA”), both companies
hereinafter referred to as “Companies”, pursuant
to CVM Rules 358/2002 and 319/1999, and as a supplement to information purpose
of the Material fact published on March 12, 2009, herein informs the
shareholders of COSAN and Curupay S.A. Participações (“Curupay”), a subsidiary
of Rezende Barbosa S.A.
Administração e Participações (“Rezende Barbosa”)
and parent company of NAA and controller of other assets related to trading,
logistics and industrial production of sugar and ethanol and energy
co-generation, that will be submitted for approval, at Extraordinary
Shareholders Meetings to be held on June 18, 2009, the corporate reorganization
of both groups resulting in the association of COSAN’s and Curupay’s sugar,
ethanol and energy activities.
The association
will be executed by means of the merger of Curupay into COSAN, with the
subsequent transfer to COSAN of the shareholders' equity of Curupay “Corporate
Reorganization”), as described below.
1. Objectives of the Corporate
Reorganization.
1.1. The Corporate
Reorganization is part of the project of merging the sugar, ethanol and energy
activities of COSAN and the Rezende Barbosa Group, whose implementation will be
performed pursuant to the Protocol and Justification of the Merger of Curupay into COSAN (“Protocol and
Justification”).
1.2. The Companies’
managements believe the Corporate Reorganization will generate important
synergies in the activities of their respective economic conglomerates, allowing
for meeting customer demands in an optimized manner. Therefore, after the
Corporate Reorganization, the Companies shall use the logistics and operating
structure of COSAN and its strong penetration in the worldwide sugar-ethanol
market, while taking advantage of the expertise and tradition of the
subsidiaries of Curupay and of the operating capacity of its
plants.
1.3. The Companies’
managements thus believe the Corporate Reorganization will strengthen their
competitive positioning, reducing risks for their shareholders and allowing for
the generation of value in the long term.
2. Conditions Precedent to the
Corporate Reorganization.
2.1. COSAN has
assumed the obligation of, up to the date of the execution of the Corporate
Reorganization and subject to its completion, taking the necessary actions with
regard to the transfer, before government–held and private financial
institutions, of Rezende Barbosa and/or its respective shareholders and/or
companies of the Rezende Barbosa Group which are not subsidiaries of Curupay, as
well as of the assets and/or properties offered by said persons as guarantee in
any surety, mortgage, collateral, pledge or any other guarantee granted on
behalf of Curupay’s subsidiaries and/or companies controlled by these
subsidiaries.
2.2. An agreement
was also entered into for an exports pre-payment operation with the main
creditors, maturing in five (5) years.
3. Acts which Preceded the
Operation.
3.1. On April 17,
2009, an operation was completed for the sale of 49% of the shares issued by
Teaçu Armazéns Gerais S.A. (“Teaçu”) owned by
Rezende Barbosa, in order to allow for the integration of the port activities of
Cosan Operadora Portuária S.A. and of Teaçu. These companies are currently
subsidiaries of Rumo Logística S.A., which in its turn is a subsidiary of Novo
Rumo Logística (“Novo Rumo”), whose control is shared between Rezende Barbosa
and COPSAPAR Participações S.A. (“COPSAPAR”), a subsidiary of COSAN which, after
the merger, will control 100% of Novo Rumo’s capital stock.
3.2. On April 30,
2009, NAA performed a partial spin-off, transferring part of its equity to
Rezende Barbosa. The portion transferred by NAA consisted of agricultural assets
of the company that, pursuant to an agreement between COSAN and Rezende Barbosa,
are not included in the Corporate Reorganization operation.
3.3. Also on April
30, 2009, and immediately after the spin-off operation mentioned on item 3.2
above, shares were transferred to the capital stock of Curupay by Rezende
Barbosa, representing: (i) 66.26% of NAA’s capital stock; (ii) 100% of the
capital stock of Nova América S.A. Trading (“NAT”), which in its turn holds an
interest of 33.74% in NAA’s capital stock; and (iii) 28.82% of the capital stock
of Novo Rumo.
3.4. As a
preliminary step towards the implementation of the Corporate Reorganization, in
June 1st, 2009,
the Board of Directors of COSAN has approved the Protocol and Justification, as
well as the operations purpose thereto, and the call for the shareholders
general meeting to resolve on the matter.
4. Criteria for the evaluation
of the equity of COSAN and Curupay, and treatment of equity
changes.
4.1. Curupay’s
shareholders' equity will be incorporated at book value, based on the items of
the special balance sheet prepared on April 30, 2009 (“Reporting Date”).
Deloitte Touche Tohmatsu Auditores Independentes, with headquarters at Av. Dr.
Jose Bonifácio Coutinho Nogueira, nº 150, in the City of Campinas, State of São
Paulo, Corporate Taxpayer’s ID (CNPJ) 49.928.567.0011-93 (“Deloitte”), was
chosen as the specialized company to appraise the value of the net assets of
Curupay to be merged into COSAN, by referendum of the Shareholders General
Meetings of Curupay and COSAN. Deloitte and its professionals in charge of the
appraisal declare (i) not to have any direct or indirect interest in the
Companies involved or in the operation itself, and there is no other material
circumstance which may characterize conflict of interests, and (ii) the
controllers and the management of the Companies involved have not guided,
restrained or impeded, or practiced any acts which have or might have
compromised the access to, the use of, or the knowledge of information, assets,
documents or work methodologies which are relevant to the quality of their
respective conclusions. Pursuant to the appraisal report (“Equity Report”), the
shareholders' equity of Curupay was worth R$334,172,000.00 on the Reporting
Date.
4.2. The Merger
will be executed based on the replacement ratio discussed and determined by the
management of the Companies, provided for in item 5.2, which is supported by an
economic-financial analysis on the economic value of COSAN and Curupay, prepared
by Banco de Investimentos Credit Suisse (Brazil) S.A. (“Credit Suisse”), with
headquarters at Av. Brigadeiro Faria Lima, nº 3.064 13º andar, in the City
of São Paulo, State of São Paulo, Corporate Taxpayer’s ID (CNPJ)
33.987.793/0001-33 (“Economic-Financial Appraisal
Report”). Credit Suisse appraised, on the Reporting Date, COSAN and
Curupay based on identical criteria and dates, pursuant to the
Economic-Financial Appraisal Report.
4.3. As the
Economic-Financial Appraisal Report provides ranges of share replacement ratios,
the managements of both Companies, considering the ranges of share replacement
ratios provided, understand the proposed replacement ratio is a fair and
equitable parameter to determine the relation between the economic values of the
Companies.
4.4. The changes in
equity ascertained on the Reporting Date and up to the date of the execution of
the Corporate Reorganization shall be appropriated by COSAN.
5. Replacement ratio, number
and species of the shares to be assigned to Curupay’s shareholder, share rights
granted by the new shares.
5.1. The
replacement ratios referred to herein have been negotiated between the
managements of COSAN and Curupay, are deemed fair and equitable for the
shareholders of both Companies, and have been proposed by the managements of
COSAN and Curupay.
5.2. A total of
132.567627 common shares of COSAN will be assigned to Rezende Barbosa for each
one common share of Curupay, with the issuance by COSAN of a total of 44,300,389
non-par registered book-entry common shares, representing eleven point
eighty-nine percent (11.89%) of its capital stock, immediately after the
issuance of the shares mentioned in this item 5.2. The share replacement ratio
is supported by an economic-financial appraisal prepared by a specialized
company, pursuant to item 4.2. above, based on available economic and financial
information on the current status and future business perspectives of both COSAN
and Curupay.
5.2.1 The
shares representing 0.89% of Cosan’s capital stock, which shall be transferred
to Rezende Barbosa, will be deposited under Banco Itaú S.A.’s custody, and will
be released to Rezende Barbosa as certain promissory notes in the amount of
R$136,946,880.21 are effectively received by NAA and NAT. Rezende Barbosa
emitted promissory noted (i) in favor of NAA in the amount of twenty million,
twenty eight thousand and one hundred thirty three Brazilian Reais and three
cents (R$ 20,028,133.03); (ii) in favor of NAT in the amount of one hundred and
sixteen million, nine hundred and eighteen thousand and seven hundred forty
seven Brazilian Reais and eighteen cents (R$ 116,918,747.18).
5.3. COSAN’s common
shares to be assigned to Rezende Barbosa, single holder of common shares of
Curupay, in replacement to the current shares of Curupay that shall be cancelled
will be entitled the same rights of the common shares issued by COSAN currently
outstanding, including the right to receive integral dividends and/or interest on shareholder's equity
to be declared by the Company.
5.4. There are
currently no shares issued by Curupay held by COSAN, nor shares issued by COSAN
held by Curupay.
6. Increase in and breakdown of
COSAN’s capital stock following the Corporate
Reorganization.
6.1. The book value
of the shareholders' equity of Curupay to be merged into COSAN is
R$334,172,000.00, pursuant to the Equity Report.
6.2. The merger of
the shareholders' equity of Curupay will result in an increase in the capital
stock of COSAN in the same amount referred to in item 6.1. The capital stock of
COSAN will thus be increased from R$3,819,769,887.34 to R$4,153,941,887.34, with
the issuance of 44,300,389 non-par registered book-entry common shares to be
fully assigned to Rezende Barbosa. The issued shares shall be paid-up with the
absorption of Curupay’s shareholders' equity, pursuant to article 227, paragraph
1 of Law 6.404/76.
6.3 All shares of Curupay held by Rezende Barbosa shall be
cancelled upon the merger into COSAN, and replaced by the new common
shares issued by COSAN, pursuant to the replacement ratio provided for in item
5.2. above.
7. Costs.
7.1. The
managements of the Companies estimate the costs to perform the Corporate
Reorganization shall amount to two million reais (R$2,000,000.00), comprising
the expenses with publications, auditors, appraisers and attorneys contracted to
provide consulting services related to the Corporate
Reorganization.
8. Further information on the
operation.
8.1.
Submission to Authorities
8.1.1. The
Corporate Reorganization has been reported to the Administrative Council for
Economic Defense – CADE. Any further communications related to the Corporate
Reorganization shall be submitted to the proper government authorities, pursuant
to applicable law.
8.2. Liabilities and contingencies not
accounted for
8.2.1. There are no
material contingent liabilities that have not been duly accounted
for.
9. Documents
availability.
9.1. The Protocol
and Justification and the other documents referenced by this Material Fact and
article 3 of CVM Rule 319/99 shall be filed with, pursuant to applicable law,
the CVM and the Bovespa, and shall be available at the Companies’ headquarters
and on COSAN’s website (www.cosan.com.br). The financial statements from NAA
will be published until Cosan General Shareholders Meetings that will deliberate
over the Corporate Reorganization.
São Paulo, June 02,
2009.
|
Marcelo
Eduardo Martins
|
Alberto
Asato
|
|
CFO and
Investor Relations Officer
Cosan S.A.
Indústria e Comércio
|
Managing
Director
and Investor
Relations Officer
Nova América S.A.
Agroenergia
|
ITEM
5
PROTOCOL
AND JUSTIFICATION OF MERGER OF
CURUPAY
S.A. PARTICIPAÇÕES INTO COSAN S.A. INDÚSTRIA E COMÉRCIO
The parties
hereinbelow:
COSAN S.A. INDÚSTRIA E
COMÉRCIO, a joint-stock company, with headquarters in the
City of Piracicaba,
State of São Paulo, in
the administrative building of Cosan, Bairro Costa Pinto, s/n.º, Corporate Taxpayer’s
ID 50.746.577/0001-15,
whose articles of incorporation are filed with the Registry of Commerce of the
State of São Paulo under Corporate Registry ID – NIRE number 35.300.177.045, herein represented in the
form of its bylaws (“Cosan” or “Merging Company”); and
CURUPAY S.A. PARTICIPAÇÕES, a
joint-stock company,
with headquarters in the City of Tarumã, State of São Paulo, at Fazenda Nova América,
s/n.º, Bairro Água da Aldeia, Miguel Jubran Highway, SP 333, towards Assis from
Tarumã, Km 418 + 500m, turning right on the Antônio Maia Highway, towards Frutal do Campo, plus 9 Km, Rural Zone,
Corporate Taxpayer's ID (CNPJ/MF) 09.460.704/0001-11, whose articles of
incorporation are filed with the Registry of Commerce of the State of São Paulo,
herein represented in the form of its bylaws (“Curupay” or “Merged
Company”)
Hereby agree upon
entering into this Protocol and Justification of Merger (“Protocol and
Justification”), which provides for the merger of Curupay (“Merger”), pursuant
to articles 224 to 227 of Law 6,404 of December 15, 1976, as amended (“Brazilian
Corporate Law”), whose terms will be submitted to the shareholders general
meetings of both companies, pursuant to the applicable law.
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1.
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JUSTIFICATION
OF THE MERGER
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1.1 The
Merger is part of a project for the strategic association between Cosan and
Rezende Barbosa S.A. Administração e Participações (“Rezende Barbosa”),
controlling shareholder of Curupay, for joint operation in the Brazilian sugar
and ethanol market, whose implementation shall be performed pursuant to this
Protocol and Justification. Cosan and Rezende Barbosa understand that, in the
current situation of the worldwide sugar and ethanol market, the synergy of
their activities will allow for meeting the demand for the products manufactured
and traded by them in an optimized manner.
1
1.2 Therefore,
Cosan and Rezende Barbosa intend to structure a form of association what allows
for the use of the logistics and operating structure of Cosan and its strong
penetration in the worldwide sugar and ethanol market, while taking advantage of
the expertise and tradition of the companies that are part of the economic group
of Curupay and of the operating capacity of Curupay’s plants.
1.3 Cosan
will remain, after the Merger, a publicly–held company listed on the Novo
Mercado segment of the BM&F Bovespa S.A. – Securities, Commodities and
Futures Exchange (“Bovespa”), counting on the financial, human and technological
resources of Cosan and Curupay, in addition to the expertise of the companies in
their respective areas of operation.
1.4 The
Companies’ managements believe the Merger will allow for Cosan to be better
positioned in the current scenario of the market where the company operates,
will strengthen its competitive positioning, reducing risks for its shareholders
and allowing for the generation of value in the long term.
1.5 The
Merger will also allow for the exploration of potential synergies between Cosan
and Curupay, in addition to the creation of a company with recurring revenue,
operating cash generation, and increased alignment of interests between the
shareholders and the management.
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2.
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BASIS
FOR THE MERGER OPERATION
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2.1 The
Merger shall be performed in such a manner that Cosan receives, for its
respective equity values – the entirety of the assets, rights and liabilities of
Curupay, including immovable assets.
2.2 As
a result of the Merger, Cosan shall increase its shareholders' equity in an
amount corresponding to the total value of the shareholders' equity of Curupay
to be merged.
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3.
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REPLACEMENT
RATIO, NUMBER AND SPECIES OF THE SHARES TO BE ASSIGNED TO CURUPAY’S
SHAREHOLDERS AND SHARE RIGHTS GRANTED BY THE NEW
SHARES
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3.1 As
a result of the Merger, 132.567627 common shares of the Company for each 1
common share issued by Curupay will be assigned to Rezende Barbosa, single
shareholder of Curupay, of a total of
2
44,300,389 common
shares issued by Cosan, representing 11.89% of the capital stock of this company
after the Merger and respective increase in Cosan’s capital stock.
3.2 The
ratio for the replacement of Curupay’s common shares for common shares issued by
Cosan has been determined in a negotiation between the managements of both
companies, and is supported by an economic-financial appraisal prepared by a
specialized company, pursuant to item 4 below, based on available economic and
financial information on the current status and future business perspectives of
both Cosan and Curupay.
3.3 Cosan’s
common shares to be assigned to the holders of common shares of Curupay – in
replacement to the current shares of Curupay that shall be cancelled – will be
entitled the same rights of the common shares issued by Cosan currently
outstanding, and will participate in the results for the current fiscal year
declared as of this date. The rights and statutory benefits of Cosan’s currently
outstanding shares shall remain unchanged.
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4.
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CRITERIA
FOR THE EVALUATION OF THE EQUITY OF CURUPAY AND COSAN, AND TREATMENT OF
EQUITY CHANGES
|
4.1 Curupay’s
shareholders' equity shall be incorporated at book value, based on the items of
the special balance sheet dated April 30, 2009 (“Reporting Date”). Deloitte
Touche Tohmatsu Auditores Independentes, with headquarters at Av. Dr. Jose
Bonifácio Coutinho Nogueira, nº 150, in the City of Campinas, State of São
Paulo, Corporate Taxpayer’s ID (CNPJ/MF) 49.928.567.0011-93 (“Deloitte”), was
chosen as the specialized company to appraise the value of the net assets of
Curupay to be merged into Cosan.
4.2 The
appointment of Deloitte as the appraiser of the book value of Curupay’s shares
shall be ratified by Cosan’s shareholders, at the Extraordinary General Meeting
called to resolve on the Merger, and it shall also be ratified by Curupay’s
shareholders, at the meeting called to resolve on the Merger.
4.3 Deloitte
and its professionals in charge of the appraisal declare (i) not to have any
direct or indirect interest in the Companies involved or in the operation
itself, and there is no other material circumstance which may characterize
conflict of interests, and (ii) the controller and the management of the
Companies involved have not guided, restrained or impeded, or practiced any acts
which have or
3
might have
compromised the access to, the use of, or the knowledge of information, assets,
documents or work methodologies which are relevant to the quality of their
respective conclusions. Pursuant to the appraisal report attached hereto as
Exhibit I (“Equity Report”), the book value of the shareholders' equity of
Curupay was worth R$334,172,000.00 on the Reporting Date.
4.4 The
Merger shall be executed based on the replacement ratio discussed and determined
by the managements of the companies, provided for in item 3.1 above. The
replacement ratio is supported by an economic-financial appraisal of the
economic value of Cosan and Curupay, pursuant to applicable law, prepared by
Banco de Investimentos Credit Suisse (Brazil) S.A. (“Credit Suisse”), with
headquarters at Avenida Brigadeiro Faria Lima, n.º 3.064, 13º floor, in the City
of São Paulo, State of São Paulo, Corporate Taxpayer’s ID 33.987.793/0001-33
(“Economic-Financial Appraisal Report”). Credit Suisse appraised, on
the Reporting Date, COSAN and Curupay based on identical criteria and dates,
pursuant to the Economic-Financial Appraisal Report.
4.5 As
the Economic-Financial Appraisal Report provides ranges of share replacement
ratios, the managements of both Companies, considering the ranges of share
replacement ratios provided, understand the proposed replacement ratio is a fair
and equitable parameter to determine the relation between the economic values of
the Companies.
4.6 The
changes in equity ascertained as of the Reporting Date and up to the date of the
execution of the Merger shall be appropriated by COSAN.
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5.
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SHARES
OF ONE COMPANY HELD BY THE OTHER
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5.1 There
are currently no shares issued by Curupay held by Cosan, nor shares issued by
Cosan held by Curupay.
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6.
|
INCREASE
IN AND BREAKDOWN OF COSAN’S CAPITAL STOCK FOLLOWING THE
MERGER
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6.1 The
book value of the shareholders' equity of Curupay to be merged into Cosan is
R$334,172,000.00, pursuant to the Equity Report.
4
6.2 The
Merger of the shareholders' equity of Curupay shall result in an increase in the
capital stock of Cosan in the same amount referred to in item 6.1 above. The
capital stock of Cosan will thus be increased from R$3,819,769,887.34 to
R$4,153,941,887.34, with the issuance by Cosan of 44,300,389 non-par registered
book-entry common shares to be fully assigned to Rezende Barbosa. The issued
shares shall be paid-up with the absorption of Curupay’s shareholders' equity,
pursuant to article 227, paragraph 1 of the Brazilian Corporate
Law.
6.3 All
shares of Curupay shall be cancelled upon the Merger and replaced by the new
common shares issued by Cosan, pursuant to the replacement ratio provided for in
item 3.1 above.
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7.
|
AMENDMENT
TO COSAN’S BYLAWS
|
7.1 Upon
the approval of the Merger in the terms provided for herein, the capital stock
of Cosan shall consist of 372,585,273 non-par registered common shares, and the
caput of article 5 of Cosan’s bylaws shall be amended to reflect this change.
The following wording for article 5 shall be submitted to Cosan’s
shareholders:
“Article
5. The subscribed and paid-up capital stock is R$4,153,941,887.34,
divided into 372,585,273 non-par book-entry registered common
shares.
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8.
|
EXTRAORDINARY
GENERAL MEETINGS
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8.1 On
the date of the Merger, an Extraordinary General Meeting shall be held by Cosan
to: (i) examine, discuss and approve the Protocol and Justification of the
Merger of Curupay into Cosan; (ii) ratify the appointment and contracting of
Deloitte as the company in charge of preparing the appraisal report, at book
value, of Curupay’s shareholders' equity; (iii) approve the appraisal report
referred to in (ii) above; (iv) ratify the appointment and contracting of Credit
Suisse as the company in charge of preparing the appraisal report, at market
value, of Curupay, for purposes of determining the share replacement ratio; (v)
approve the appraisal report referred to in (iv) above; (vi) resolve on the
merger of Curupay and the consequent increase in Cosan’s capital stock through
the issuance, for private subscription, of common shares to be subscribed and
paid up by Rezende Barbosa, in virtue of the transfer of Curupay’s shareholders'
equity to Cosan as a result of the merger, with the subsequent
5
amendment to the
caput of Article 5 of Cosan’s Bylaws; and (vii) authorize Cosan’s Management to
take the necessary actions to implement the merger referred to in item (vi)
above.
8.2 Likewise,
on the date of the Merger, an Extraordinary General Meeting shall be held by
Curupay to: (i) examine, discuss and approve the Protocol and Justification of
the Merger of Curupay into Cosan; (ii) ratify the appointment and contracting of
Deloitte as the company in charge of preparing the appraisal report, at book
value, of Curupay’s shareholders' equity; (iii) approve the appraisal report
referred to in (ii) above; (iv) ratify the appointment and contracting of Credit
Suisse as the company in charge of preparing the appraisal report, at market
value, of Curupay, for purposes of determining the share replacement ratio; (v)
approve the appraisal report referred to in (iv) above; (vi) resolve on the
merger of Curupay into Cosan, at market value, pursuant to the Protocol and
Justification; and (vii) authorize Curupay’s Management to take the necessary
actions to implement the merger referred to in item (vi) above.
8.3 Upon
the approval of the Merger, it shall be incumbent upon Cosan to file all
pertinent acts with the appropriate Registry of Commerce. Cosan’s Management
undertakes to execute all other acts necessary for the Merger to be in full
compliance with the law. All costs and expenses arising from the implementation
of the Merger shall be incumbent upon Cosan.
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9.
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WINDING-UP
OF CURUPAY
|
9.1 The
execution of the Merger described herein shall result in the winding-up of
Curupay, which shall be succeeded by Cosan in all its assets, rights and
liabilities.
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10.
|
NOTICES
AND NOTIFICATIONS
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10.1 All
notices, notifications or any other communication related to this Protocol and
Justification shall be made in written, and be considered as duly delivered (a)
upon receipt, if delivered in person, (b) if facsimiled or e-mailed, (c) if
delivered through an express delivery service or as a registered or certified
correspondence, with request of receipt acknowledgement with the postal fees
paid free of charge for the recipients to be sent to the following addresses (or
any other address specified in such notice):
6
(i)
if addressed to Cosan’s Management:
C/O: Legal
Officer
Cosan’s
administrative building, Bairro Costa Pinto, s/n.º
Piracicaba –
SP
E-mail:
jurídico@cosan.com.br
(ii) if
addressed to Curupay’s shareholders and Management:
C/O: Mr. Alberto
Asato
Fazenda Nova
América, s/n.º
Tarumã – São
Paulo
E-mail:
alberto.asato@novamerica.com.br
10.2 The
party whose address, fax number or email address indicated above, has been
changed shall promptly inform the new address, fax number or e-mail address to
the other parties. All notifications, communications and summons sent to the
address, fax number or email provided above shall be considered valid and in
force until this notification of change has been made.
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11.
|
FINAL
PROVISIONS
|
11.1 Pursuant
to article 12 of CVM Rule 319 of December 03, 1999, as amended (“CVM Rule 319”),
Curupay’s financial statements supporting the Merger have been audited by
Deloitte.
11.2 There
are no material liabilities or contingent liabilities that have not been duly
accounted for in the Equity Report. Furthermore, Curupay’s and Cosan’s
managements mutually declare not to be aware of the existence of any material
liability or contingent liability that has not been informed to the Management
of the other company and to their advisors during the period of negotiation of
the replacement ratio.
11.3 This
Protocol and Justification and the financial statements supporting the Merger,
as well as the other documents referred to by article 3 of CVM Rule 319 are
available to their shareholders as of this date at the headquarters of Cosan and
Curupay.
11.4 Up
to the approval of the operation by the authorities, Cosan shall not exercise
any interference whatsoever on the management or control of Curupay, not
appointing managers, nor participating in the
7
management of
personnel, acquisition or sale of assets, investment projects, trade policy,
budget or business plan, budget execution, compliance with legal or contractual
obligations, changes in the number of employees, or any other act that shall
imply a change in the production capacity or efficiency of Cosan, or any other
act that shall imply the irreversibility of the operation should it not be
approved by the competent authorities. The provisions of this item apply mutatis mutandis for Cosan
with regard to Curupay.
11.5 The
Merger has been reported to the Administrative Council for Economic Defense –
CADE. Any further and due communications related to the Merger shall be
submitted to the competent government authorities, pursuant to applicable
law.
11.6 Should
any provision, term or condition of this Protocol and Justification be
considered void, the remaining provisions, terms and conditions not affected by
this annulment shall not be affected.
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12.
|
ARBITRATION
|
12.1 Should
lawsuits or divergences related to this Protocol and Justification arise, the
parties agree to endeavor their best efforts to settle them in a friendly manner
and in accordance with the principles of good faith. Should the controversy not
be settled in a friendly fashion as mentioned above, the controversy shall be
definitely settled by means of arbitration, to be established and processed
pursuant to the Regulations of the Arbitration Center of the Brazil-Canada
Chamber of Commerce (“Regulations”). The management and development of the
arbitration proceedings shall be incumbent upon said Chamber
(“Chamber”).
12.2 The
Court of Arbitration shall comprise three (3) arbitrators, and it shall be
incumbent upon each of the parties to appoint one arbitrator and a respective
deputy, not necessarily members of the Chamber’s Body of Arbitrators, within the
fifteen (15) days following the date of receipt of the notification sent by the
Chamber.
12.3 The
arbitrators appointed by the parties shall jointly appoint the third arbitrator,
who shall preside the Court of Arbitration and submit his name to the approval
of the Chamber.
8
12.4 If
any of the parties refrains from appointing an arbitrator and/or deputy, it
shall be incumbent upon the Chamber’s president to appoint them. Should the
arbitrators appointed by the parties not come to an agreement with regard to the
appointment of the third arbitrator, it shall also be incumbent upon the
Chamber’s president to appoint him.
12.5 The
Court of Arbitration shall be settled in the City of São Paulo, and Portuguese
shall be the official language for all its acts.
12.6 The
arbitration decision shall be final and binding for the parties, and it shall
not be subject to ratification or any resource before the Justice.
12.7 The
parties herein agree that during the arbitration proceedings or in the case of a
pending court decision in any lawsuit between the parties, none of them is
authorized to terminate or refrain from fulfilling the obligations hereby
established.
12.8 In
order to settle preventive matters arising from this instrument before the
formation of the Court of Arbitration, as well as matters of an enforceable
nature, the parties choose the jurisdiction of the City of São Paulo, State of
São Paulo, and expressly waive any other jurisdiction, no matter how privileged
it may be.
(remainder
of the page intentionally left blank)
9
In witness whereof,
the parties hereto execute this instrument in two (2) counterparts of equal
tenor and form, in the presence of two (2) witnesses undersigned
below.
São
Paulo/Piracicaba (SP), June 2, 2009.
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Merged
Company:
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CURUPAY
S.A. PARTICIPAÇÕES
|
|
|
Merging
Company:
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COSAN
S.A. INDÚSTRIA E COMÉRCIO
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|
|
Witnesses:
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||||
| Name: | Name: | |||
| Identity Card (RG): |
Identity Card
(RG):
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|||
| Individual Taxpayers' ID (CPF/MF): | Individual Taxpayers' ID (CPF/MF): |
10
EXHIBIT
I
EQUITY
REPORT
 |
Credit Suisse Appraisal Report Cosan S.A. Industria e Comercio and Curupay S.A. - Participacoes April 30th, 2009 |
 |
Table of Contents
1. Introduction 2
2. Transaction summary 8
3. Description of the market and the companies 14
3.1. Cosan S.A. Industria e Comercio 18
3.2. Curupay S.A. Participacoes ("NovAmerica") 25
4. General assumptions of the Appraisal Report 32
5. Cosan's Appraisal 34
5.1. Discounted Cash Flow 34
5.2. Economic value - comparable companies' multiples 44
5.3. Book value of shareholder's equity 46
5.4. Weighted average price by the stock's trade volume on BOVESPA 48
6. Nova America's Appraisal 51
6.1. Discounted Cash Flow 51
6.2. Economic value - comparable companies' multiples 60
6.3. Book value of shareholder's equity 62
7. Analysis of relationship of substitution 64
Appendix A. Companies' Weighted Average Cost of Capital (WACC) 67
Appendix B. Market multiples of comparable companies 69
Appendix C. Description of the applied evaluation methodologies 73
Appendix D. Terms and definitions used in the appraisal report 78
1
Credit Suisse
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 |
1. Introduction
2
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 |
Introduction
The Banco de Investimentos Credit Suisse (Brasil) S.A. ("CS") was appointed by
Cosan SA Industria e Comercio ( "Cosan") to prepare an economic and financial
appraisal report ("Appraisal Report ") in reference to the equity value of
Curupay SA. - Participacoes ( "NovAmerica") and the equity value of Cosan
(NovAmerica and Cosan combined herein denominated "Companies"), for the purposes
of establishing a relationship of substitution between both parties under the
proposed incorporation of NovAmerica (the "Transaction") as provided for in CVM
Rule no. 319 of December 3rd, 1999, ("Regulation CVM 319/99").
The following information is important and should be read carefully and
thoroughly:
1. This Appraisal Report has been prepared solely for the use of Cosan's Board
of Directors and its shareholders for the evaluation of the proposed
Transaction and should not be used for any other purpose, including,
without limitation, to establish and increase capital, under the laws of
S.A. (limited partnerships), in particular Articles 8 and 170, and other
provisions of the S.A. laws involving the Company and / or its affiliates.
This appraisal report should not be used by any other third parties and may
not be used for any other purpose without prior written permission from CS.
This appraisal report, including its analysis and conclusions, do not
constitute a recommendation to any shareholder or member of the Board of
Directors of NovAmerica or Cosan on how to vote or act on any matter
relating to the Transaction. The data base used in this Appraisal Report is
of April 30th, 2009.
2. To reach the conclusions presented in this Appraisal Report, among other
things: (i) we reviewed the consolidated financial statements of Nova
America S.A. - Agroenergia , audited by Delloite Touche Tohmatsu
("Delloite") for the years ended April 30th, 2006, 2007 and 2008 and the
interim consolidated financial statements for the nine-month period ended
January 31, 2009 (subject of a special review report by Delloite), this
information does not reflect the effects of the corporate reorganization
that preceded the Transaction, (ii) we reviewed the consolidated financial
statements of Curupau S.A. - Participacoes ("NovAmerica"), audited by
Delloite for the year ended April 30th, 2009, (iii) we reviewed the
consolidated financial statements of Cosan, audited by Ernst & Young
Independent Auditors S.C. ("Ernst & Young") for the years ended April 30th,
2006, 2007 and 2008 and the interim consolidated financial statements for
the nine-month period ended January 31, 2009 (subject of a special review
report by Ernst & Young), we (iv) reviewed and discussed with the
administration of Cosan and NovAmerica the financial, operational and
management projections of each of the Companies for the next 10 years, (v)
discussed with the members of the administration of NovAmerica and Cosan
the Company's business and prospects, (vi) in appraisals of this nature we
have access to historical information on a comparable basis as to our
projections, however, in this case, we had no access to historical
financial statements of Curupay S.A. - Participacoes ("NovAmerica") pro
forma effects of the corporate reorganization and these effects were not
discussed with Delloite, however, we discussed with the administration of
NovAmerica the impacts of the corporate reorganization in the result
projections of NovAmerica and incorporated them in these projections and
(vi) took into account other information, financial studies, analysis,
research and financial, economic and market criteria that we consider
relevant (collectively, the "Information").
3. In the scope our review, we do not assume any responsibility for
independent investigations of any of the information above and we trust
that such information was complete and accurate in all material respects.
Furthermore, we were not asked to perform, and did not perform an
independent verification of such information, or independent verification
or appraisal of any assets or liabilities (contingent or otherwise) of any
of the Companies, we were not given any evaluation in this respect and we
did not evaluate the solvency or fair value of the Companies considering
the laws relating to bankruptcy, insolvency or similar issues. 3
|
 |
Introduction (cont'd)
4. We will not, explicitly or implicitly, make any representation or statement
with respect to any information (including financial and operating
projections for each of the Companies or assumptions and estimates on which
such projections were based) used for the preparation of the Appraisal
Report. Furthermore, we do not assume any obligation to conduct, and did
not conduct, any physical inspection of the Companies' properties or
premises. We are not an accounting firm and do not provide accounting or
auditing services in relation to this Appraisal Report or the Transaction.
5. The operational and financial projections of NovAmerica and Cosan were
based on information obtained from the NovAmerica and Cosan and other
public information, and we assume that these projections reflect the best
estimates currently available with respect to the Companies' future
financial performance, which were evaluated on a stand alone basis, without
synergies.
6. In relation to the Companies' operational and financial projections that
were sent to us, the Administration declared that these projections were
prepared in a reasonable manner on assumptions that reflect the best
estimates currently available and the Administration's best judgment with
respect to the Companies' future financial performance. If this assumption
is not valid, the results presented here may be altered substantially.
7. Projections related to demand and market growth were submitted by the
Companies. We assumed, in good faith, that these projections were prepared
in a reasonable manner reflecting the best estimates currently availables.
8. The Appraisal Report is not and should not be used as (i) an opinion on the
adequacy (fairness opinion) of the Transaction, (ii) a recommendation in
relation to any aspect of the Transaction and (iii) an opinion on the
adequacy or determination of the fair and/or correct value of the
Companies' shares.
9. Based on the discounted cash flow methodology, we assumed the macroeconomic
scenario announced by the Central Bank of Brazil in its Focus Report, which
reflects average market expectations and may present substantially
different future results. Since the analysis and values are based on
forecasts of future results, they do not necessarily indicate the
Companies' actual and future financial results, which may be significantly
more or less favorable than those suggested by our analysis. Moreover,
since these analysis are inherently subject to uncertainties and are based
on various events and factors outside of our and the Companies' control, we
are not in any way responsible if any of the Companies' future results
differ substantially from the results presented in this Appraisal Report.
There is no guarantee that the Companies' future results will correspond to
the financial projections used as basis for our analysis, and the
differences between our projections and the Companies' financial results
may not be relevant. The Companies' future results may also be affected by
economic and market conditions.
4
|
 |
Introduction (cont'd)
10. The preparation of a financial analysis is a complex process involving
several definitions regarding methods of financial analysis most
appropriate and relevant as well as the application of such methods. To
reach the conclusions presented in the Appraisal Report, we conducted
qualitative reasoning in regards to the considered analysis and factors. We
reached a final conclusion based on the results of the conducted analysis,
as a whole, and did not arrive at conclusions based on, or related to, any
separate factors or methods of analysis. Thus, we believe that our analysis
should be considered as a whole and that the selection of parts of our
analysis and specific factors, without considering the entire analysis and
conclusions, can result in an incomplete and incorrect understanding of the
processes used for our analysis and conclusions.
11. This Appraisal Report indicates only the Companies' value and does not
evaluate any aspect or implication of the Transaction or any contract,
agreement or understanding reached with respect to the Transaction. We do
not express any opinion as to what the value of the issued stock should be
pursuant to the Transaction or as to the amount in which the Companies'
stock will be or could be traded in the securities market at any time. This
Appraisal Report does not address the merits of the Transaction as compared
to other business strategies that may be available to NovAmerica and to
Cosan, nor addresses the business decision of the parties involved of
whether to carry out the Transaction. The results presented in this
Appraisal Report refer exclusively to the Transaction and do not apply to
any other matter or operation, present or future, relative to any of the
Companies, the economic group to which they belong or the their industry.
12. Our Appraisal Report is based essentially on information that has been
submitted to us on this date, and considering market, economic and other
conditions as they present themselves and as evaluated on this day.
Although future events and developments may affect the conclusions
presented in this Appraisal Report, we have no obligation to update,
revise, rectify or revoke this Appraisal Report, in whole or in part, due
to any subsequent development or other purpose.
13. Our analysis deal with NovAmerica and Cosan as independent operations
(stand-alone) and, thus, do not include benefits or operating losses,
fiscal or of any other nature, including any premium, nor any synergies,
incremental value and/or costs, if any, that NovAmerica or Cosan may incur
from the completion of the Transaction, if carried out, or from any other
operation. The appraisal also does not take into account any operational
and financial gain or loss that may be incurred subsequent to the
Transaction due to commercial alterations of the currently existing
businesses between NovAmerica and Cosan.
14. Cosan has agreed to reimburse us for our expenses and to indemnify us, and
those connected to us, for certain liabilities and expenses that may arise
as a result of our employment. We will receive a commission relative to the
preparation of this Appraisal Report regardless of the completion of the
Transaction
5
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 |
Introduction (cont'd)
15. We, from time to time, in the past, has provided investment banking and
other financial services to Cosan and its affiliates, for which we have
been compensated, and may in the future provide such services to NovAmerica
and Cosan and/or its affiliates, for which we expect to be compensated. We
are a financial institution that provides a variety of financial and other
services related to securities, brokerage and investment banking. In the
normal course of our activities, we may purchase, hold or sell, for our
account or for account and by order of our customers, stocks, debt
instruments and other securities and financial instruments (including bank
loans and other obligations) of NovAmerica and Cosan and of any other
companies involved in the Transaction, as well as provide investment
banking and other financial services to such companies, their parent
companies or controlled companies. Moreover, the professionals of our
securities analysis departments (research) and of other divisions may base
their analysis and publications on various market and operating assumptions
and different methods of analysis when compared with those used in
preparing this Appraisal Report, in such a manner that the research reports
and other publications prepared by them may contain results and conclusions
that differ from those presented herein. We have implemented policies and
procedures to preserve the independence of our securities analysts, which
may have different views from those of our investment banking department.
We have also implemented policies and procedures to safeguard the
independence between investment banking and other areas and departments of
CS, including but not limited to asset management, proprietary trading desk
for stocks, debt instruments, securities and other financial instruments.
16. This Appraisal Report is the intellectual property of CS.
17. The financial calculations contained in the Appraisal Report may not always
result in a precise sum due to rounding.
18. The Companies' fiscal year has a duration of one (1) year which begins on
May 1st and ends on April 30th of each year, according to the respective
Corporate Bylaws. Thus, at the end of each fiscal year, financial
statements are prepared for the fiscal year ended.
Banco de Investimentos Credit Suisse (Brasil) S.A.
6
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 |
Appraiser's Statement
For the purpose of CVM (SEC) Rule No. 319/99, CS declares:
o The funds managed by CS and its subsidiary, Credit Suisse HG Corretora de
Valores SA, hold a minority share in Cosan, based on data as of April 30th,
2009.
o It has no interest, direct or indirect, in the operation, as well as any
other relevant circumstances that may characterize conflict of interest,
reducing the required independence to perform their duties in preparing
this Appraisal Report.
o Major shareholders or Companies' directors did not direct, restrict, hinder
or exercise any actions that may, or may have, compromised the access, the
use or the knowledge of information, properties, documents or work
methodologies relevant to the quality of the respective conclusions.
o There is no conflict or pooling of interest, actual or potential, with
Cosan's main shareholders, or because of its minority shareholder(s), or
relative to NovAmerica, their respective partners, or concerning the
Transaction.
7
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 |
2. Transaction summary
8
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 |
Transaction Summary
Phase I: reorganizing NovAmerica's structure
Cosan SA Industria e Comercio announced on March 12th, 2009 its intentions to
merger their activities with that of Curupay SA - Participacoes, whereas Curupay
S.A. - Participacoes will be incorporated by Cosan.
o Binding Memorandum of Understanding ("MOU") signed with Rezende Barbosa
S.A. Administracao e Participacoes ("Rezende Barbosa"), controlling
shareholder of Curupay S.A. - Participacoes
o Rezende Barbosa conducted a corporate reorganization, whereas all assets
related to marketing, logistics and industrial production of sugar and
ethanol were incorporated by Curupay S.A - Participacoes ("NovAmerica") and
all assets related to agricultural activity were transferred into a new
company, not involved in the transaction
Phase II: NovAmerica's incorporation by Cosan
Cosan intends to incorporate NovAmerica by substituting all of its common stock
for Cosan's shares of the same class
o Rezende Barbosa will receive approximately 132.5676 shares of Cosan's stock
for each share currently held of NovAmerica's stock, so as to own the
equivalent of 11.89% of Cosan's capital after the Transaction
o Rezende Barbosa owns 100% of NovAmerica's capital
o Cosan is registered with the Securities Commission ( "CVM") and its stock
is traded on the Bolsa de Valores de Sao Paulo
Note: Curupay S.A. - Participacoes was defined in this Appraisal Report as
NovAmerica, thus their only assets are the following corporations: Nova America
Agroenergia, Nova America Trading and NovoRumo. For more details, see page 28 of
this Appraisal Report.
9
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 |
Appraisal Summary
Cosan S.A. Industria e Comercio
Based on the economic value obtained through the discounted cash flow method
(DCF), the value of Cosan's stock is between R$ 25.75 and R$ 28.32. For more
information with respect to the calculation methodology used, see Appendix C -
Description of applied appraisal methodologies on page 74 of this report
Economic Value (DCF)
(R$ million)
Equity value 8,876
Number of shares (thousands) 328,285
-4.75% +4.75%
--------------------------------------------------------------------------------
Equity value 8,454 8,876 9,298
Price per share (R$) 25.7527.04 28.32
--------------------------------------------------------------------------------
Source: Cosan and Credit Suisse. Base date: April 30th, 2009.
Economic Value (Multiples)
--------------------------------------------------------------------------------
(R$ million) 2009/10E 2010/11E
EBITDA $1,638.8 $1,948.1
x EV/EBITDA((2)) 6.4x 5.8x
= Enterprise Value 10,420.1 11,251.0
- Net debt $3,521.0 $3,521.0
= Equity Value 6,899.1 7,730.0
Number of shares (millions)((1)) 328.3 328.3
--------------------------------------------------------------------------------
low (-4.75%) R$ 20.02 R$ 22.43
R$/share average R$ 21.02 R$ 23.55
high (+4.75%) R$ 22.01 R$ 24.67
--------------------------------------------------------------------------------
Source: Cosan and Credit Suisse.
Net Worth
(R$ million) 01/31/2009
Total assets R$ 11,039.4
(-) Total liabilities 7,311.3
(-) Minority interest 31.5
= Shareholder's equity 3,696.6
Number of shares (millions)((1)) 328.3
R$/share 11.26
--------------------------------------------------------------------------------
Source: Cosan.
Weighted Average of Stock Prices
-------------------------------------------------------------------------------
12 month period prior to communicating the relevant R$ 18.99
fact
-------------------------------------------------------------------------------
(11-mar-08 to 11-mar-09)
-------------------------------------------------------------------------------
90 day period prior to communicating the relevant R$ 10.68
fact
-------------------------------------------------------------------------------
(11-dec-08 to 11-mar-09)
-------------------------------------------------------------------------------
Period between the date the relevant fact was R$ 12.05
communicated and the date of the appraisal report
-------------------------------------------------------------------------------
(12-mar-09 to 30-apr-09)
--------------------------------------------------------------------------------
Source: Bloomberg, according to information on page 49 of this
report.
(1) Source: CVM,(SEC) includes stocks in Treasury.
(2) Considers average trading multiples of comparable companies as of April
30th, 2009.
10
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Appraisal Summary
Curupay S.A. - Participacoes ("NovAmerica")
Based on the economic value obtained through the discounted cash flow method
(DCF), the value of NovAmerica's stock is between $ 3,433.98 and R$ 3,776.47.
For more information with respect to the calculation methodology used, see
Appendix C - Description of applied appraisal methodologies on page 74 of this
report
Economic Value (DCF)
(R$ million)
Equity value 1,205
Number of shares (thousands) 334
-4.75% +4.75%
--------------------------------------------------------------------------------
Equity value 1,148 1,205 1,262
Price per share (R$) 3,433.98 3,605.223,776.47
--------------------------------------------------------------------------------
Source: NovAmerica and Credit Suisse. Base date: 30th Apriil 2009.
--------------------------------------------------------------------------------
Economic Value (Multiples)
--------------------------------------------------------------------------------
(R$ million) 2009/10E 2010/11E
EBITDA $377.8 $413.9
x EV/EBITDA((2)) 6.4x 5.8x
= Enterprise Value 2,402.0 2,390.3
- Net debt $1,100.1 $1,100.1
= Equity Value 1,301.9 1,290.3
Number of shares (millions)((1)) 0.3 0.3
------------------------------------------------------------------------------
low (-4.75%) R$ 3,710.79 R$ 3,677.65
R$/share average R$ 3,895.85 R$ 3,861.05
high (+4.75%) R$ 4,080.90 R$ 4,044.45
--------------------------------------------------------------------------------
Net Worth((1))
--------------------------------------------------------------------------------
(R$ million) 3/30/2009
Total assets R$ 1,815.7
(-) Total liabilities 1,481.5
(-) Minority interest 0.0
= Shareholder's equity 334.2
Number of shares (millions)((1)) 0.3
R$/share 1,000.0
--------------------------------------------------------------------------------
Source: NovAmerica.
Source: NovAmerica and Credit Suisse.
(1) Values of Total Assets, Total Liabilities, Minority Interests, Liquid Net
Worth and Number of Stock Shares according to NovAmerica's audited Balance
Sheet dated April 30th, 2009.
(2) Considers average trading multiples of comparable companies as of April
30th, 2009.
11
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Analysis of the relationship of substitution based on DCF
-----------------------------------------------------------------------------------
Cosan
-----------------------------------------------------------------------------------
Economic value per stock using the discounted cash flow method
R$ in millions, except price per share
(R$ million)
Equity value 8,876
Number of shares (thousands) 328,285
-4.75% +4.75%
----------------------------------------------------------------------------------
Equity value 8,454 8,876 9,298
Price per share (R$) 25.75 27.04 28.32
----------------------------------------------------------------------------------
-----------------------------------------------------------------------------------
NovAmerica
-----------------------------------------------------------------------------------
Economic value per stock using the discounted cash flow method
R$ in millions, except price per share
(R$ million)
Equity value 1,205
Number of shares (thousands) 334
-4.75% +4.75%
----------------------------------------------------------------------------------
Equity value 1,148 1,205 1,262
Price per share (R$) 3,433.98 3,605.22 3,776.47
----------------------------------------------------------------------------------
121.2492x
133.3423x
146.6415x
o Based on the methodology and assumptions presented, the estimated Value of
Cosan's Stock is between R$ 6,967M and R$ 7,662M, or per share value
between R$ 21,22 and R$ 23,34
o Based on the methodology and assumptions presented, the estimated Value of
NovAmerica's Stock is between R$ 1,235M and R$ 1,358M, or a per share value
between R$ 3,694.22 and R$ 4,062.68
o The relationship of substitution range between Cosan's stock and
NovAmerica's stock is 158.2819 and 191.4297x, based on the comparison of
the calculated indicative stock values for both Companies
o The implicit relationship of substitution agreed upon by Cosan and
NovAmerica in the Memorandum equals 132.5676 x
Source: CVM,(SEC) Cosan's financial statements (on 1/31/2009) and NovAmerica's
financial statements (on 1/31/2009 and 4/3/2009) and Credit Suisse.
12
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Analysis of the relationship of substitution based on Multiples
-------------------------------------------------------------------------------------- -
Cosan
-------------------------------------------------------------------------------------- -
Economic value per stock by the multiples method
R$ in millions, except price per share
(R$ millions)
Equity value ((1)) 7,315
Number of shares (thousands ) 328,285
-4.75% +4.75%
-----------------------------------------------------------------------
Equity value 6,967 7,315 7,662
Price per share (R$) 21.22 22.28 23.34
-----------------------------------------------------------------------
NovAmerica
-------------------------------------------------------------------------
Economic value per stock by the multiples method
R$ in millions, except price per
share
(R$ millions)
Equity value ((1)) 1,296
Number of shares (thousands ) 334
-4.75% +4.75%
---------------------------------------------------------------------------
Equity value 1,235 1,296 1,358
Price per share (R$) 3,694.22 3,878.45 4,062.68
---------------------------------------------------------------------------
158.2819x
174.0686x
191.4297x
o Based on the methodology and assumptions presented, the estimated Value of
Cosan's Stock is between R$ 6,967M and R$ 7,662M, or per share value
between R$ 21.22 and R$ 23.34
o Based on the methodology and assumptions presented, the estimated Value of
NovAmerica's Stock is between R$ 1,235M and R$ 1,358M, or a per share value
between R$ 3,694.22 and R$ 4,062.68
o The relationship of substitution range between Cosan's stock and
NovAmerica's stock is 158.2819 and 191.4297x, based on the comparison of
the calculated indicative stock values for both Companies
o The implicit relationship of substitution agreed upon by Cosan and
NovAmerica in the Memorandum equals 132.5676x
Source: CVM(SEC), Cosan's financial statements (on 1/31/2009) and NovAmerica's
financial statements (on 1/31/2009 and 4/30/2009) and Credit Suisse. (1) Value
of shares equivalent to the average value based on the multiples EV/EBITDA
2009/10E and EV/EBITDA 2010/11E
13
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 |
3. Description of the market and the companies
14
|
 |
Overview of sugar and ethanol market
General industry outlook for Brazil
According to USDA data, Brazil is one of the world's largest producers and
exporters of sugar and ethanol. Projections indicate Brazilian production of the
2009/10 harvest will represent approximately 23% of the world's sugar market and
37% of all ethanol produced globally. Brazil exported approximately 61% of total
sugar and 16% of all ethanol produced in the 2007/2008 harvest.
Largest world producers of sugar
[GRAPHIC OMITTED]
Source: USDA, 2009/10 harvest projections in April 2009.
Largest world producers of ethanol
[GRAPHIC OMITTED]
Source: RFA and F.O. Licht, 2008/09 harvest projections.
Note: USDA - United States Department of Agriculture.
15
c
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Overview of sugar and ethanol market (cont'd)
Brazil has significant competitive advantages that facilitate their position as
one of the world's largest producers of sugar and ethanol:
- Favorable climatic conditions
- Vast land availability
- Strong domestic market
- Large production scale and low production costs
- Raw material (sugar cane) with long life cycle (5-6 years)
o The State of Sao Paulo is the largest producer of sugar and ethanol in
Brazil: 62% of total sugar and 59% of all ethanol produced during the
2007/08 harvest
o The sector accounted for approximately 2% of Brazilian GDP in 2007
Regional production of sugar cane
[GRAPHIC OMITTED]
Source: UNICA.
Sugar and ethanol production - South-central region
Production 2007/08 2008/09e2009/10e
------------------------------------------------------------------------
Sugar (millions of tons) 26.2 26.5 27.0
------------------------------------------------------------------------
Ethanol (billions of 20.3 23.9 26.9
liters)
------------------------------------------------------------------------
Domestic Consumption
------------------------------------------------------------------------
Sugar (millions of tons) 9.8 8.0 8.0
------------------------------------------------------------------------
Ethanol (billions of 17.3 19.7 23.7
liters)
------------------------------------------------------------------------
Available for export
-------------------------------------------------------------------------
Sugar (millions of tons) 16.4 18.5 19.0
-------------------------------------------------------------------------
Ethanol (billions of 3.1 4.2 3.2
liters)
-------------------------------------------------------------------------------
Source: UNICA.
--------------------------------------------------------------------------------
Brazilian production of sugar cane
--------------------------------------------------------------------------------
[GRAPHIC OMITTED]
Source: UNICA.
16
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Overall market overview of sugar and ethanol (cont'd)
Brazilian production of ethanol
[GRAPHIC OMITTED]
Brazilian production of sugar
[GRAPHIC OMITTED]
Source: UNICA and Foreign Trade Office (Secretaria de Comercio Exterior)
17
|
 |
3. Description of the market and companies
3.1. Cosan S.A. Industria e Comercio
18
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 |
Cosan's Summary
Brief Description
Overview
The COSAN Group is one of the largest producers, traders and global exporters of
sugar and ethanol, with milling capacity of 44.8 million tonnes per year
They are the largest global generators of electricity produced from sugar cane
bagasse
The own 18 plants, two refineries and two port terminals, one for sugar and one
for ethanol
With operations thus far concentrated in Sao Paulo, they initiated 2005 - IPO on
Bovespa's New Market the Jatai unit operation in 2009, the first module of a
greenfield project in Goias
Recently, they entered into two new businesses - land acquisition and fuel
distribution - and are present in every link of the sugar- alcohol agro
industrial chain, becoming the first Brazilian company of renewable energy to be
fully integrated Produces seven types of sugar for industrial use: crystal,
crystal demerara, VHP (Very High Polarization), refined amorphous, refined
granulated, liquid sucrose and inverted liquid
Produces four types of alcohol: refined hydrated alcohol, neutral hydrated
alcohol, hydrated ethanol fuel and ethanol anhydrous
History
1936 - Incorporation of Usina Costa Pinto
1984-94 - Development of VHP sugar (Very High Polarization)
1996 - Granted concession of terminal to export sugar
1997 - Partnership with Tate & Lyle
2000 - Official incorporation of Cosan S.A.
2000 - Alliance with Tereos and Sucden
2002 - Acquisition of Da Barra
2005 - Loan with IFC
2005 - Alliance with the Kuok Group
2006 - Perpetual bond issue (US$ 450 million)
2007 - 10 year bond Issue (US$ 400 million)
2007 - NYSE IPO of Cosan Ltd, controlling company
2008 - Cosan S.A. capital Increase (R$ 880 million)
2008 - Establishment of Radar subsidiary
2008 - Acquisition of Exxon assets in Brazil ($ 900 million)
Note: Greenfield: term for projects that take place at a location where there
are no assets of operations. Source: Website and companies reports.
19
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 |
Cosan's Summary (cont'd)
Company Overview
Status: Listed on the New Market (Bovespa) - Ticker: CSAN3
Founded in: 1936
Headquarters: Piracicaba, Sao Paulo, Brazil
Administration: Rubens Ometto Silveira Mello, CEO
Pedro Isamu Mizutani, Executive Vice President
Marcelo Eduardo Martins, CFO, Investor Relations and M&A
Executive Director
Marcos Marinho Lutz, Commercial and Logistic Vice President
Board Members: Rubens Ometto Silveira Mello, President
Pedro Isamu Mizutani, Vice-President
Marcelo Eduardo Martins, Member
Burkhard Otto Cordes, Member
Pedro Luiz Cerize, Independent member
Mailson Ferreira da Nobrega, Independent member
Marcus Vinicius Pratini de Moraes, Independent member
Operational Highlights - harvest of 2007/08
40.3 million tons of processed sugar cane
1.6 billion liters of sold ethanol
415.5 million liters of exported ethanol
Source: Website and the company's consolidated financial dada .
20
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 |
Cosan's organization structure
[GRAPHIC OMITTED]
Source: Cosan S.A. Annual Report (2008) .
21
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 |
Cosan's financial information
Financial information
In millions of R$
Consolidated Income Statement Fiscal year ended in April 30 9 months ended in
2006 2007 2008 Jan-31-08 Jan-31-09
Net Operational Revenues 2,477.9 3,605.1 2,736.2 1,893.2 4,199.2
Gross Profit 756.6 1,123.9 349.0 199.7 559.5
Margin 30.5% 31.2% 12.8% 10.5% 13.3%
Revenues (Expenses) Operational (819.1) (558.6) (428.0) (262.5) (1,285.8)
Profit (Loss) Operational (62.5) 565.3 (79.0) (62.9) (726.2)
Margin -2.5% 15.7% -2.9% -3.3% -17.3%
Net Income (64.6) 357.3 (47.8) (42.5) (433.6)
Margin -2.6% 9.9% -1.7% -2.2% -10.3%
EBITDA 517.7 928.0 172.9 126.7 435.5
Margin 20.9% 25.7% 6.3% 6.7% 10.4%
Source: Cosan's financial statements, CVM. Cosan's consolidated financial
statements, audited by Ernst & Young for year-ended April 30th 2006, 2007 and
2008 and the interim consolidated financial statements for the nine-month period
ended January 31, 2008 and 2009 (subject of a special review report by Ernst &
Young)
22
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 |
Cosan's financial information (cont'd)
Balance sheet
In millions of R$
Balance Sheet Fiscal year ended in April 30
2006 2007 2008 Jan-31-09
Assets 5,604.8 6,263.5 7,393.5 11,039.4
Current Assets 2,013.5 2,224.8 2,283.6 3,409.0
Cash and Cash and Equivalents 831.5 1,217.1 1,010.0 689.7
Derivative Financial Instruments 288.6 37.6 86.5 17.9
Accounts Receivable 212.6 112.3 215.2 459.0
Inventories 390.8 503.4 570.5 1,643.7
Advances to Suppliers 132.7 211.4 226.2 239.9
Related Parties - - 16.3 35.8
Deferred Income Taxes 41.4 38.1 - -
Recoverable Taxes 63.4 54.0 129.8 240.7
Other Assets 52.5 50.9 29.1 82.3
Noncurrent Assets 3,591.3 4,038.7 5,109.9 7,630.4
Deferred Income and Social Contrib. Taxes 361.8 242.5 357.0 665.0
Advances to Suppliers - - 77.3 125.3
Other Assets 204.4 554.1 618.3 676.8
Investments 13.4 93.2 120.3 280.5
Property, Plant and Equipment 1,656.4 2,013.1 2,771.4 3,365.0
Goodwill 1,353.0 1,133.2 1,160.7 2,493.8
Deferred Charges 2.3 2.6 4.9 24.0
Source: Cosan's financial statements, CVM. Cosan's consolidated financial
statements, audited by Ernst & Young for year-ended April 30th 2006, 2007 and
2008 and the interim consolidated financial statements for the nine-month period
ended January 31, 2008 and 2009 (subject of a special review report by Ernst &
Young)
23
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 |
Cosan's financial information (cont'd)
Balance sheet
---------------------------------------------------------------------------------------
In millions of R$
Balance Sheet Fiscal year ended in April 30
2006 2007 2008 Jan-31-09
Liabilities & Shareholder's Equity 5,604.8 6,263.5 7,393.5 11,039.4
Current Liabilities 670.0 591.9 577.7 2,358.3
Loans and Financing 68.8 89.0 83.3 1,484.7
Derivatives Financial Instruments 65.4 35.5 41.9 49.5
Suppliers 201.7 113.8 191.0 518.2
Salaries Payable 49.7 63.3 80.7 77.7
Taxes and Social Contributions Payable 111.1 126.2 116.1 163.2
Advances from Customers 79.2 49.4 26.3 33.1
Other Liabilities 94.1 114.7 38.4 31.9
Noncurrent Liabilities 3,565.3 4,020.4 3,472.3 4,953.1
Loans and Financing 2,002.7 2,770.4 2,136.2 2,904.5
Taxes and Social Contributions Payable 446.9 338.5 359.3 336.0
Provision for Contingencies 907.4 728.0 832.4 1,114.1
Other Liabilities 208.3 183.5 144.4 598.5
Minority Interest 14.0 20.2 17.7 31.5
Shareholder's Equity 1,355.5 1,631.0 3,325.8 3,696.5
Capital 1,185.8 1,192.7 2,935.3 3,815.3
Profit Reserves - 227.3 180.2 180.2
Other Reserves 195.9 211.0 210.3 109.1
Stock in Treasury - - - (4.2)
Accumulated Profits (Losses) (26.2) - - (403.9)
--------------------------------------------------------------------------------------
Source: Cosan's financial statements, CVM. Cosan's consolidated financial
statements, audited by Ernst & Young for year-ended April 30th 2006, 2007 and
2008 and the interim consolidated financial statements for the nine-month period
ended January 31, 2008 and 2009 (subject of a special review report by Ernst &
Young)
24
|
 |
3. Description of the market and companies
3.2. Curupay S.A. Participacoes ("NovAmerica") [GRAPHIC
25
|
 |
NovAmerica's Summary
Brief Description
Overview
With over 60 years of history, the NovAmerica group is one of the largest sugar
cane processors in Brazil
Total milling capacity of over 8.5 million tons per year
Largest sugar and ethanol producer in the Medio Vale do Paranapanema, in the
state of Sao Paulo
The group is the current leader of the Brazilian refined sugar retail market,
with a share of approximately 37.6%, operating under the brands: Union, Dolce,
Ducula and Neve
They own three sugar and ethanol plants: Taruma, Maracai and Paraguacu
Distillery, which together are responsible for milling approximately 90% of the
sugar cane consumed by the group
They own two packing units (in Sertaozinho - SP and Araquari -SC) and one
refining and packing unit (in Piedade-RJ)
Portfolio of products: crystal sugar, refined amorphous and granulated, light,
liquid, confectioner's, ethyl alcohol (anhydrous and hydrated), yeast from sugar
cane and electricity from biomass
--------------------------------------------------------------------------------
History
1944 - Renato de Rezende Barbosa purchase Fazenda Nova America 1994 -
Production of the refined brand Dolce
2005 - Incorporation of Usina Maracai
2005 - Uniao brand acquisition
2008 - Acquisition of Paralcool (Paraguacu Destillery)
--------------------------------------------------------------------------------
Operational Highlights
------------------------------------------------------
Harvest of 07/08 UNITS TOTAL
------------------------------------------------------
Milling Tons (`000) 8,700
Sugar Tons (`000) 656
Ethanol m(3) (`000) 311
Anhydrous m(3) (`000) 247
Hydrated m(3) (`000) 64
Sugar mix % 42.2
Ethanol mix % 57.8
Electric energy MW 150,000
-------------------------------------------------------
Source: Website and company reports.
26
|
 |
NovAmerica's organizational structure
Structure on January 31st, 2009
[GRAPHIC OMITTED]
Note: TEAS is to be the object of a purchase and sale transaction and is
not included in the incorporation.
27
|
 |
NovAmerica's organization structure
Structure after corporate reorganization
[GRAPHIC OMITTED]
Note: TEAS is to be the object of a purchase and sale transaction and is not
included in the incorporation.
28
|
 |
NovAmerica's financial information
Financial information
In millions of R$
Consolidated Income Statement Fiscal year ended in March 30
2006 2007 2008 9M08((1)) 9M09((1))
Net Operating Revenues 1,099.6 1,244.1 912.3 855.7 1,009.8
Gross Profit 258.1 286.5 120.5 127.1 177.7
Margin 23.5% 23.0% 13.2% 14.9% 17.6%
Operational Revenues (Expenses) (247.8) (192.2) (257.4) (195.9) (267.0)
Operational Profit (Loss) 10.2 94.3 (136.9) (68.8) (89.3)
Margin 0.9% 7.6% -15.0% -8.0% -8.8%
Net Income 17.9 73.8 (72.3) (27.7) (58.8)
Margin 1.6% 5.9% -7.9% -3.2% -5.8%
EBITDA 123.5 119.4 36.4 76.8 169.9
Margin 11.2% 9.6% 4.0% 9.0% 16.8%
----------------------------------------------------------------------------------
Source: Nova America S.A. - Agroenergia's consolidated financial statements,
audited by Delloite Touche Tohmatsu ("Delloite") for year-ended April 30th 2006,
2007 and 2008; the interim consolidated financial statements for the nine-month
period ended January 31, 2009 (subject of a special review report by Delloite)
and Curupay S.A. - Participacoes ("NovAmerica") financial statements, audited by
Delloite for year-ended April 30th, 2009
29
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 |
NovAmerica's financial information (cont'd)
----------------------------------------------------------------------------------------------------------------
Balance Sheet
----------------------------------------------------------------------------------------------------------------
In millions of R$
Balance sheet Fiscal year ended in March 30
2006 2007 2008 jan-31-08 jan-31-09 apr-31-09((1))
Assets 903.9 1,056.7 1,598.9 1,445.1 1,760.6 1,815.7
Current Assets 393.2 483.9 457.2 514.2 490.4 409.1
Cash and Cash Equivalents 38.1 71.2 126.6 72.6 37.2 40.0
Accounts Receivable 148.2 103.7 105.1 132.0 156.5 121.6
Inventories 158.1 243.4 180.1 266.7 247.6 159.1
Others 48.8 65.7 45.4 42.9 49.1 88.3
Noncurrent Assets 510.7 572.8 1,141.7 931.0 1,270.2 1,406.6
Deferred Income and Social Contributions Taxes 27.2 27.3 136.5 85.3 233.3 86.7
Others 20.7 28.7 42.6 31.1 - 234.2
Fixed Assets 462.8 516.7 962.6 814.6 1,036.9 1,085.7
Investiments 0.7 1.4 164.3 165.1 0.6 72.4
Property, Plant and Equipment 400.0 468.1 764.1 611.6 838.1 693.1
Intangible 62.0 47.3 34.2 38.0 198.3 320.3
Source: Nova America S.A. - Agroenergia's consolidated financial statements,
audited by Delloite Touche Tohmatsu ("Delloite") for year-ended April 30th 2006,
2007 and 2008; the interim consolidated financial statements for the nine-month
period ended January 31, 2009 (subject of a special review report by Delloite)
and Curupay S.A. - Participacoes ("NovAmerica") financial statements, audited by
Delloite for year-ended April 30th, 2009
(1) NovAmerica's audited Balance Sheet, after corporate restructuring.
30
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 |
NovAmerica's financial information (cont'd)
Balance sheet
In millions of R$
Balance sheet Fiscal year ended in March 30
2006 2007 2008 jan-31-08 jan-31-09 apr-31-09((1))
Liabilities & Shareholder's Equity 903.9 1,056.7 1,598.9 1,445.1 1,760.6 1,815.7
Current Liabilities 236.0 345.8 657.0 412.2 716.5 921.1
Loans and Financing 53.0 226.1 87.5 107.1 384.7 636.5
Debentures - - 321.3 5.7 11.5 -
Suppliers 82.0 60.6 75.7 59.1 92.5 159.9
Taxes 18.3 17.6 34.9 35.2 41.1 -
Dividends Payable 63.1 - - - - -
Provisions 17.1 16.4 22.1 13.1 14.5 -
Liabilities with Related Parties - 21.3 68.4 143.2 94.0 -
Others 2.6 3.9 47.1 48.8 78.3 124.7
Noncurrent Liabilities 306.9 341.6 645.3 691.3 668.9 560.5
Loans and Financing 185.3 229.9 195.2 200.9 195.5 503.7
Debentures - - - 306.9 150.0 -
Provisions 19.2 14.5 19.5 19.1 23.7 13.9
Liabilities with Related Parties - - 150.1 - 156.2 -
Advances for Future Capital Raising 4.2 - 103.7 14.9 - 0.5
Others 60.6 61.3 141.0 113.5 107.6 42.5
Results from Future Periods 37.7 35.9 35.9 35.9 35.9 -
Minority Interest 0.9 0.1 0.2 0.0 0.2 0.0
Shareholder's equity 360.9 369.4 296.5 341.7 375.2 334.2
Capital 262.0 314.0 314.0 314.0 448.0 334.2
Capital Reserve 2.0 - - - - -
Profit Reserve 4.2 4.7 4.7 4.7 4.7 -
Accumulated Profit (Losses) 92.7 50.7 (22.1) 23.0 (77.5) -
---------------------------------------------------------------------------------------------------------------------------------
Source: Nova America S.A. - Agroenergia's consolidated financial statements,
audited by Delloite Touche Tohmatsu ("Delloite") for year-ended April 30th 2006,
2007 and 2008; the interim consolidated financial statements for the nine-month
period ended January 31, 2009 (subject of a special review report by Delloite)
and Curupay S.A. - Participacoes ("NovAmerica") financial statements, audited by
Delloite for year-ended April 30th, 2009
(1) NovAmerica's audited Balance Sheet, after corporate restructuring.
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4. General Assumptions of the Appraisal Report
32
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Macro-economic Assumptions
The macroeconomic assumptions detailed below represent estimated values
presented in the Focus Report by Banco Central as of April 30th 2009
2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19
Exchange rates
R$/US$ end of period 2.22 2.25 2.25 2.27 2.32 2.37 2.43 2.49 2.55 2.61
R$/US$ average 2.23 2.22 2.22 2.24 2.29 2.35 2.40 2.46 2.52 2.58
Inflation
IGP-M((1)) 2.9% 4.5% 4.5% 4.5% 4.4% 4.4% 4.4% 4.4% 4.4% 4.4%
IPCA((1)) 4.3% 4.4% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5%
EUA inflation((2)) 0.1% 1.1% 1.5% 1.8% 1.9% 1.9% 1.9% 1.9% 1.9% 1.9%
Taxa de juros
Average Selic((1)) 9.9% 9.5% 9.5% 9.5% 9.5% 9.5% 9.5% 9.5% 9.5% 9.5%
Gross Domestic Product
GDP Real Growth - Brazil((1)) 1.0% 3.7% 4.1% 4.2% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0%
GDP Real Growth - Global((3)) 0.9% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0%
GDP Real Growth - USA((3)) -0.5% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
Source: Focus Report of Brazilian Central Bank as of April 30, 2009.
Note: Values converted from calendar year to Cosan and NovAmerica's fiscal year (May 1st to April 30th).
(1) Because of the inexistence of interest rates, inflation and GDP estimates
from 2014, w as considered the values presented in 2013 to Selic (9.5%),
IGP-M (4.4%), IPCA (4.5%) and GDP real grow th (4.0%)
(2) Source: Economist Inteligence Unit, as of 4/29/2009.
(3) Source: World Bank until 2010, as of 03/31/2009. Constant since then.
From 2014 onwards, exchange rate forecasts assume maintenance of the purchasing
power parity between the US and Brazilian currencies
33
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5. Cosan's Appraisal
5.1. Discounted Cash Flow
34
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Appraisal using discounted cash flow
CS has evaluated Cosan according to the discounted cash flow (DCF) method
Methodology
O Unlevered cash flow method
- Projection of unlevered cash flows
- Cash flows are discounted based on Weighted Average Cost of Capital
(WACC), in order to calculate its present value
Projections
O CS used, for evaluation purposes, the operational and financial projections
provided by and/or discussed with Cosan's administrative teams, in nominal
R$.
Currency
O Projections in nominal R$
O The unlevered cash flow is converted into US$ each year in order to be
discounted
Discounted Cash Flow
O Base date: April 30th 2009; cash flows are converted to April 30th 2009
present value.
O Projection Horizon: 2009/2010 to 2018/2019
O Considers that flows are generated throughout the year ("mid-year
convention")
O Discounted cash flow in nominal US$
35
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Economic value - discounted cash flow
Based on the economic value criteria according to the discounted cash flow
method, as of April 30th 2009, Cosan's stock prices ranged from R$25,75 to
R$28,32.
--------------------------------------------------------------------------------
Economic value per stock according to the discounted
cash flow method
--------------------------------------------------------------------------------
R$ million, except values per stock
(R$ million)
Equity value 8,876
Number of shares (thousands) 328,285
-4.75% +4.75%
------------------------------------------------------------------------------
Equity value 8,454 8,876 9,298
Price per share (R$) 25.75 27.04 28.32
------------------------------------------------------------------------------
Source: CVM (SEC) Cosan's financial statements (as of Jan 30th 2009) and Credit
Suisse.
36
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 |
Main Assumptions Used
Macro-economics Macro-economic scenario of the Focus Report from
Banco Central dated April 30th 2009
Cost of sold products According to projections by Cosan's Administration
Operational
Expenses According to projections by Cosan's Administration
Working capital According to projections by Cosan's Administration
for stock variations, accounts payable,
receivables, other assets and other liabilities
Terminal value Gordon growth model (in perpetuity)((1)), in
2018/19
Assumes a growth rate of 2.5% in US$ nominal terms
in perpetuity
Other Logistics negotiations are currently held in
conjunction by Cosan and NovAmerica, with 71.2%
and 28.8% participations, respectively.
Cash flow from this business are weighted
according to the percentage above for each
Company.
Discount rate Discount rate calculated based on: (i) median
unlevered beta of the sector re-levered by the
projected optimal capital structure, (ii) optimal
capital structure based on comparable companies in
the sector and discussions with Cosan's
Administration, and (iii) country risk.
Perpetuity = FCL(n) x (1+g)
--------------
WACC - g
(1) Estimated based on the free cash flow for the previous projection period and
incremented by the growth expectation, using the Continuous Growth Model or
Gordon Growth Model as shown in the equation:
Where: "FCL(n)" is the projected free cash flow for the previous year, "g" is
the continuous growth rate for the post-projected period and "WACC" is the
average capital cost weighted by the optimal capital structure.
37
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 |
Main Projections
Sugar and Ethanol
Crushing Capacity
[GRAPHIC OMITTED]
Prices - Sugar
[GRAPHIC OMITTED]
Production Mix
[GRAPHIC OMITTED]
Prices- Ethanol
[GRAPHIC OMITTED]
38
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 |
Main Projections (cont'd)
Distribution
[GRAPHIC OMITTED]
39
|
 |
Main Projections (cont'd)
Logistics
--------------------------------------------------------------------------------
Volume
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Prices
--------------------------------------------------------------------------------
40
|
 |
Main Projections (cont'd)
Cogeneration
--------------------------------------------------------------------------------
Installed Capacity
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Energy available for sale
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
41
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Main Projections (cont'd)
Financial Results
--------------------------------------------------------------------------------
Net Income
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EBITDA
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EBIT
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Investments
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
42
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Main Projections (cont'd)
Operational Cash flow
--------------------------------------------------------------------------------
Cash flow for the company (R$ millions)
--------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------------------------------------
2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 Perpetuity
----------------------------------------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------------------------------------
Net Revenues 15,897,417 17,543,744 19,774,794 22,136,334 24,496,440 26,327,243 28,220,81330,310,536 32,592,853 34,985,685 35,277,084
----------------------------------------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------------------------------------
EBITDA 1,638,801 1,948,083 2,532,761 3,063,534 3,663,938 3,930,545 4,111,238 4,359,643 4,645,957 4,904,484 4,748,763
----------------------------------------------------------------------------------------------------------------------------------------------------------
(-) Depreciation and (829,854) (958,282) (1,118,397)(1,060,847)(1,096,325) (1,124,551)(1,189,623)(1,240,000)(1,295,078)(1,337,920)(1,054,119)
Amortization
----------------------------------------------------------------------------------------------------------------------------------------------------------
EBIT 808,947 989,801 1,414,364 2,002,687 2,567,613 2,805,994 2,921,616 3,119,643 3,350,879 3,566,564 3,694,644
----------------------------------------------------------------------------------------------------------------------------------------------------------
(-) Taxes (270,392) (326,788) (467,173) (660,516) (848,049) (927,116) (964,235)(1,028,911)(1,104,569)(1,174,033)(1,278,283)
----------------------------------------------------------------------------------------------------------------------------------------------------------
Unlevered Net Income 538,556 663,013 947,191 1,342,172 1,719,564 1,878,878 1,957,381 2,090,732 2,246,310 2,392,531 2,317,099
----------------------------------------------------------------------------------------------------------------------------------------------------------
(+) Depreciation and 829,854 958,282 1,118,397 1,060,847 1,096,325 1,124,551 1,189,623 1,240,000 1,295,078 1,337,920 1,054,119
Amortization
(-) Investiments (1,412,307) (1,766,551) (2,017,437)(1,387,996) (954,045) (870,008) (894,138) (942,641) (979,262)(1,054,119)(1,054,119)
(-) Working Capital Variation (88,123) (91,097) (158,651) (118,164) (148,543) (103,261) (113,657) (112,338) (121,305) (122,221) (122,221)
----------------------------------------------------------------------------------------------------------------------------------------------------------
Free Cash Flow to the Firm (132,021) (236,353) (110,500) 896,859 1,713,301 2,030,161 2,139,208 2,275,754 2,440,820 2,554,111 2,194,878
FCF (R$)
----------------------------------------------------------------------------------------------------------------------------------------------------------
Fx rate 2.23 2.22 2.22 2.24 2.29 2.35 2.40 2.46 2.52 2.58 2.58
----------------------------------------------------------------------------------------------------------------------------------------------------------
Free Cash Flow to the Firm (59,114) (106,465) (49,700) 399,789 747,310 865,119 890,014 924,416 968,003 988,961 9,679,014
FCF (US$)
----------------------------------------------------------------------------------------------------------------------------------------------------------
US$ millions R$ millions
-------------------------------------------------------------------------------------------
Enterprise Value $5,691 $12,397
Discounted Cash Flows - 2009/10 - 2018/19 $2,605 $5,674
Perpetuity $3,086 $6,723
Net Debt $3,521
Equity Value $8,876
-------------------------------------------------------------------------------------------
43
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 |
5. Cosan's Appraisal
5.2. Economic Value - comparable companies' multiples
44
|
 |
Eonomic Value - comparable companies' multiples
Based on the economic value criteria by the comparable companies' multiples
method, Cosan's value range per stock is demonstrated below:
-----------------------------------------------------------------------------------------------------
Economic value by the comparable companies' multiples
method
-----------------------------------------------------------------------------------------------------
R$ millions, except values per stock
(R$ million) 2009/10E 2010/11E
EBITDA $1,638.8 $1,948.1
x EV/EBITDA((2)) 6.4x 5.8x
= Enterprise Value 10,420.1 11,251.0
- Net debt $3,521.0 $3,521.0
= Equity Value 6,899.1 7,730.0
Number of shares (millions)((1)) 328.3 328.3
---------------------------------------------------------------------------------------------
low (-4.75%) R$ 20.02 R$ 22.43
R$/share average R$ 21.02 R$ 23.55
high (+4.75%) R$ 22.01 R$ 24.67
---------------------------------------------------------------------------------------------
Source: Cosan and Credit Suisse.
(1) Considers average trade multiple of comparable companies as of April 30th
2009.
(2) Source: CVM,(SEC) includes treasury stocks.
45
|
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5. Cosan's Appraisal
5.3. Book value of shareholder's equity
46
|
 |
Book value of shareholder's equity
Based on book value of liquid net worth, Cosan's value per stock is R$11,26
----------------------------------------------------------------------------------------------
Value of liquid net worth per share
----------------------------------------------------------------------------------------------
R$ millions, except values per stock
(R$ million) 01/31/2009
Total assets R$ 11,039.4
(-) Total liabilities 7,311.3
(-) Minority interest 31.5
= Shareholder's equity 3,696.6
Number of shares (millions)((1)) 328.3
R$/share 11.26
----------------------------------------------------------------------------------------------
Source: CVM (SEC), Cosan's financial statements
(1) Includes treasury stock
47
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5. Cosan's Appraisal
5.4. Weighted average price by stock's trade volume on BOVESPA
48
|
 |
CSAN3
Weighted average price by stock's trade volume on BOVESPA
Cosan stock price (CSAN3) on BOVESPA
[GRAPHIC OMITTED]
Source: Bloomberg, as of April 30th 2009.
Cosan stocks are included in the Ibovespa index
49
|
 |
Market value of stocks
Based on the weighted average price by the trading volume of stocks issued by
Cosan on BOVESPA, Cosan stock values are demonstrated below:
Weighted average price by trading volume of stocks listed on BOVESPA
Period of 12 months immediately preceding of the publication of the material fact ((1))
11-mar-08 - 11-mar-09 R$ 18.99
Number of shares (millions) ((2)) 328.3
Equity Value (R$ millions) 6,234.3
Period of 90 days immediately preceding of the publication of the material fact ((1))
11-dec-08 - 11-mar-09 R$ 10.68
Number of shares (millions) ((2)) 328.3
Equity Value (R$ millions) 3,505.7
Period between the date of publication of material fact and the date of the fairness opinion
12-mar-09 - 30-apr-09 R$ 12.05
Number of shares (millions) ((2)) 328.3
Equity Value (R$ millions) 3,956.1
Source: Bloomberg, as of April 30th
(1) Relevant fact dated March 12th 2009 regarding NovAmerica's incorporation by
Cosan.
(2) Source: Cosan, Bloomberg and Economatica (includes treasury stock).
50
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6. NovAmerica's Appraisal
6.1. Discounted Cash Flow
51
|
 |
Discounted cash flow appraisal
CS has appraised NovAmerica according to the discounted cash flow ("DCF") method
Methodology
o Unlevered cash flow method
- Projection of unlevered cash flows
- Cash flows are discounted based on Weighted Average Cost of Capital
(WACC), in order to calculate its present value
Projections
o CS used, for evaluation purposes, the operational and financial projections
provided by and/or discussed with NovAmerica's administrative teams, in
nominal R$.
o Projections consider NovAmerica's structure after corporate restructuring
Currency
o Projections in nominal R$
o The unlevered cash flow is converted into US$ each year in order to be
discounted
Discounted Cash Flow
o Base date: April 30th of 2009; cash flows converted to April 30th of 2009
present value.
o Projection horizon: 2009/2010 to 2018/2019
o Considers that flows are generated throughout the year ("mid-year
convention")
o Discounted cash flow in nominal US$
52
|
 |
Economic value - discounted cash flow
Based on the economic value criteria according to the discounted cash flow
method, as of April 30th 2009, NovAmecica stock prices ranged from R$3,433.98 to
R$3,776.47 per stock
-----------------------------------------------------------------------------------------------------
Economic value per stock according to the discounted cash
flow method
-----------------------------------------------------------------------------------------------------
R$ millions, except values per stock
(R$ million)
Equity value 1,205
Number of shares (thousands) 334
-4.75% +4.75%
-------------------------------------------------------------------------------------
Equity value 1,148 1,205 1,262
Price per share (R$) 3,433.98 3,605.22 3,776.47
-------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------
Source: CVM, (SEC) NovAmerica's financial statements (as of Jan 30th 2009) and Credit Suisse.
53
|
 |
Main Assumptions Used
Macro-economics
Macro-economic scenario of the Focus Report from Banco Central dated April 30th
2009
Cost of sold products
According to projections by NovAmerica's Administration
Operational Expenses
According to projections by NovAmerica's Administration
Working capital
According to projections by NovAmerica's Administration for stock variations,
accounts payable, receivables, other assets and other liabilities
Terminal value
Gordon growth model (in perpetuity)((1)), in 2018/19
Assumes a growth rate of 2.5% in US$ nominal terms in perpetuity
Other
Logistics negotiations are currently held in conjunction by Cosan and
NovAmerica, with 71.2% and 28.8% participations, respectively.
Cash flow from this business are weighted according to the percentage above for
each Company.
Discount rate
Discount rate calculated based on: (i) median unlevered beta of the sector
re-levered by the projected optimal capital structure, (ii) optimal capital
structure based on comparable companies in the sector and discussions with
Cosan's Administration, and (iii) country risk.
--------------------------------------------------------------------------------
(1) Estimated based on the free cash flow projected for the previous period and
incremented by the growth expectation, using the Continuous Growth Model or
Gordon Growth Model as shown in the equation:
[equation omitted]
Where: "FCL(n)" is the projected free cash flow for the previous year, "g" is
the continuous growth rate for the post-projected period and "WACC" is the
average capital cost weighted by the optimal capital structure.
54
|
 |
Main Projections
Sugar and Ethanol
--------------------------------------------------------------------------------
Crushing Capacity
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Production mix
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Prices - Sugar
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Prices - Ethanol
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
55
|
 |
Main projections (cont'd)
Logistics
--------------------------------------------------------------------------------
Sales
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Prices
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
56
|
 |
Main projections (cont'd)
Cogeneration
--------------------------------------------------------------------------------
Energy available for sale
--------------------------------------------------------------------------------
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
57
|
 |
Main Projections (cont'd)
Financial results
--------------------------------------------------------------------------------
Net Income
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Gross Profit
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EBITDA
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Investments
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Production mix
[GRAPHIC OMITTED]
--------------------------------------------------------------------------------
58
|
 |
Main projections (cont'd)
--------------------------------------------------------------------------------
Cash flow for the company (R$ millions)
--------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------------------------------------------
2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 Perpetuity
----------------------------------------------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------------------------------------------
Net Revenues 1,491,274 1,564,033 1,771,749 1,833,770 1,925,372 2,013,247 2,101,053 2,192,861 2,288,793 2,390,286 2,455,976
----------------------------------------------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------------------------------------------
EBITDA 377,763 413,879 475,684 498,578 544,060 573,300 600,239 628,020 657,193 688,489 687,304
----------------------------------------------------------------------------------------------------------------------------------------------------------------
(-) Depreciation and (123,261) (132,623) (115,496) (123,901) (93,173) (93,938) (104,874) (116,159) (127,834) (139,809) (135,645)
Amortization
----------------------------------------------------------------------------------------------------------------------------------------------------------------
EBIT 254,502 281,256 360,188 374,677 450,888 479,362 495,365 511,861 529,359 548,680 551,659
----------------------------------------------------------------------------------------------------------------------------------------------------------------
(-) Taxes (84,977) (94,030) (120,800) (125,650) (151,502) (161,109) (166,456) (171,971) (177,824) (184,418) (185,303)
----------------------------------------------------------------------------------------------------------------------------------------------------------------
Unlevered Net Income 169,525 187,226 239,388 249,026 299,385 318,253 328,909 339,890 351,535 364,262 364,123
----------------------------------------------------------------------------------------------------------------------------------------------------------------
(+) Depreciation and 123,261 132,623 115,496 123,901 93,173 93,938 104,874 116,159 127,834 139,809 135,645
Amortization
(-) Investiments (198,055) (220,338) (110,351) (95,066) (96,108) (109,151) (110,862) (115,984) (121,112) (135,645) (135,645)
(-) Working Capital Variation (83,365) (7,461) (27,222) (7,590) (4,274) (11,600) (13,672) (14,332) (14,911) (15,322) (15,322)
----------------------------------------------------------------------------------------------------------------------------------------------------------------
Free Cash Flow to the Firm 11,366 92,050 217,311 270,271 292,177 291,441 309,249 325,733 343,347 353,104 348,802
FCF (R$)
----------------------------------------------------------------------------------------------------------------------------------------------------------------
Fx rate 2.23 2.22 2.22 2.24 2.29 2.35 2.40 2.46 2.52 2.58 2.58
----------------------------------------------------------------------------------------------------------------------------------------------------------------
Free Cash Flow to the Firm 5,089 41,464 97,741 120,478 127,442 124,193 128,662 132,313 136,168 136,723 1,538,151
FCF (US$)
----------------------------------------------------------------------------------------------------------------------------------------------------------------
US$ millionsR$ millions
--------------------------------------------------------------------------------
Enterprise Value $1,058$2,305
Discounted Cash Flows - 2009/10 - 2018/19 $568$1,236
Perpetuity $490$1,068
Net Debt $1,100
Equity Value $1,205
--------------------------------------------------------------------------------
59
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 |
6. NovAmerica's Appraisal
6.2. Economic value - comparable companies' multiples
60
|
 |
Economic Value - comparable companies' multiples
Based on the criteria of economic value by the comparable companies' multiples
method, the range of value per share of NovAmerica is as follows:
----------------------------------------------------------------------------------------------------
:Economic value per share by the comparable companies'
multiples method
----------------------------------------------------------------------------------------------------
(R$ million) 2009/10E 2010/11E
EBITDA $377.8 $413.9
x EV/EBITDA((2)) 6.4x 5.8x
= Enterprise Value 2,402.0 2,390.3
- Net debt $1,100.1 $1,100.1
= Equity Value 1,301.9 1,290.3
Number of shares (millions)((1)) 0.3 0.3
----------------------------------------------------------------------------------------------------
low (-4.75%) R$ 3,710.79 R$ 3,677.65
R$/share average R$ 3,895.85 R$ 3,861.05
high (+4.75%) R$ 4,080.90 R$ 4,044.45
----------------------------------------------------------------------------------------------------
Source NovAmerica and Credit Suisse.
(1) As of April 30th 2009.
(2) Considers average trading of comparable companiies as of April 30th 2009.
61
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 |
6. NovAmerica Appraisal
6.3. Book value of shareholder's equity
62
|
 |
Book value of shareholder's equity
Based on the criteria of liquid net worth, the value per NovAmerica share is
R$1,000.00 per share
----------------------------------------------------------------------------------------------
Book value of liquid net worth per share
----------------------------------------------------------------------------------------------
R$ millions, except values per share
(R$ million) 3/30/2009
Total assets R$ 1,815.7
(-) Total liabilities 1,481.5
(-) Minority interest 0.0
= Shareholder's equity 334.2
Number of shares (millions)((1)) 0.3
R$/share 1,000.0
----------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
Source: NovAmerica financial statements
(1) As of April 30th 2009.
63
|
 |
7. Analysis of the relationship of substitution
64
|
 |
Analysis of the relationship of substitution based on DCF
[GRAPHIC OMITTED]
o Based on the methodology and assumptions presented, the estimated Value of
Shares for Cosan is between R$8.454M and R$9.298M, or a value per share
between R$25,75 and R$28,32
o Based on the methodology and assumptions presented, the estimated Value of
Shares for NovAmerica is between R$1.148M and R$1.262M, or a value per
share between R$3.433,98 and R$3.776,47
o The range of the substitution relationship between Cosan and NovAmerica
shares is between 121.2492x and 146.6415x, based on comparison of the
indicative values per share calculated for both Companies
o The implicit substitution relationship agreed between Cosan and NovAmerica
in the Memorandum is equivalent to 132.5676x
--------------------------------------------------------------------------------
Source: CVM (SEC) Cosan financial statements (as of 31/1/2009) and NovAmerica
(as of 31/1/2009 and 30/4/2009) and Credit Suisse.
65
|
 |
Analysis of the relationship of substitution based on Multiples
[GRAPHIC OMITTED]
o Based on the methodology and premises presented the estimated Value of
Shares for Cosan is between R$6.967M and R$7.662M, or a value per share
between R$21,22 and R$23,34
o Based on the methodology and premises presented the estimated Value of
Shares for NovAmerica is between R$1.235M and R$1.358M, or a value per
share between R$3.694,22 and R$4.062,68
o The range of the substitution relationship between Cosan and NovAmerica
shares is between 158.2819x and 191.4297x. based on comparison of the
indicative values per share calculated for both Companies
o The implicit substitution relationship agreed between Cosan and NovAmerica
in the Memorandum is equivalent to 132.5676x
--------------------------------------------------------------------------------
Source: CVM (SEC) Cosan financial statements (as of 31/1/2009) and NovAmerica
(as of 31/1/2009 and 30/4/2009) and Credit Suisse.
(1) Value of Shares equivalent to average value between/based on multiples
EV/EBITDA 2009/10E and EV/EBITDA 2010/11E
66
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 |
Appendix A. Companies' Weighted Average Cost of Capital (WACC)
67
|
 |
Weighted Average Cost of Capital (WACC)
Debt / Leverage Taxes Beta
Beta S.Equity Factor Unlevered Assumptions
Comparable Companies (B)(4) (4) (5) (6)
---------------------------------------------------------------------------------------------------------------------------------
Sao Martinho 0.958 70.8% 1.47 34.0% 0.65 Taxes -Brasil 34.00%
Acucar Guarani 1.277 100.0% 1.66 34.0% 0.77 USA risk free rate (Rf)(1) 2.97%
Agrana Beteiligungs AG 0.356 100.0% 1.75 25.0% 0.20 Market Risk Premium (Rm) (2) 7.07%
Associated British Foods PLC 0.886 15.9% 1.11 30.0% 0.80 Country Risk Premium (CRP) (3) 3.86%
CSR Ltd. 1.494 81.1% 1.57 30.0% 0.95 -------------------------------------------
Danisco A/S 0.965 95.5% 1.69 28.0% 0.57
Ebro Puleva S.A. 0.566 84.8% 1.57 32.5% 0.36
Greencore Group PLC 1.394 100.0% 1.88 12.5% 0.74
Illovo Sugar Ltd. 0.750 41.8% 1.26 36.9% 0.59
Suedzucker AG 0.679 69.7% 1.43 38.4% 0.48
Tate & Lyle PLC 0.959 79.4% 1.56 30.0% 0.62
Tongaat-Hulett Ltd. 1.024 27.8% 1.18 36.9% 0.87
Bajaj Hindustan Ltd. 1.571 100.0% 1.66 34.0% 0.95
Balrampur Chini Mills Ltd. 1.496 91.8% 1.61 34.0% 0.93
Shree Renuka Sugars Ltd. 1.367 57.8% 1.38 34.0% 0.99
Average 1.05 74.4% 31.3% 0.70
Median 0.97 81.1% 34.0% 0.74
---------------------------------------------------------------------------------------------------------------------------------------------------
Cost of debt before taxes 9.5% 10.0% 10.5% 11.0% 11.5% 12.0%
Cost of debt after taxes 6.3% 6.6% 6.9% 7.3% 7.6% 7.9%
-----------------------------------------------
Total Debt/ Total Debt/ Unlev. Beta Leverage Levered Cost of Debt/
Total Cap((7)) S. Equity Average Factor Beta(8) Equity(9) Total C. WACC
--------------------------------------------------
20.0% 25.0% 0.74 1.17 0.87 13.0% 20.0%
--------------------------------------------------
11.6% 11.7% 11.7% 11.8% 11.9% 11.9%
25.0% 33.3% 0.74 1.22 0.91 13.2% 25.0% 11.5% 11.6% 11.7% 11.7% 11.8% 11.9%
-----------------------------
30.0% 42.9% 0.74 1.28 0.95 13.6% 30.0% 11.4% 11.5% 11.6% 11.7% 11.8% 11.9%
35.0% 53.8% 0.74 1.36 1.01 14.0% 35.0% 11.3% 11.4% 11.5% 11.6% 11.7% 11.8%
40.0% 66.7% 0.74 1.44 1.07 14.4% 40.0% 11.1% 11.3% 11.4% 11.5% 11.7% 11.8%
-----------------------------
45.0% 81.8% 0.74 1.54 1.14 14.9% 45.0% 11.0% 11.2% 11.3% 11.5% 11.6% 11.8%
50.0% 100.0% 0.74 1.66 1.23 15.6% 50.0% 10.9% 11.1% 11.2% 11.4% 11.6% 11.7%
--------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------------------------------
(1) Risk Free Rate for USA calculated by the Credit SuisseFinancial Strategies
Group
(2) Stock market risk premium calculated by the Credit Suisse Financial
Strategies Group
(3) Brazil risk premium calculated by the Credit Suisse Financial Strategies
Group
(4) Barra Beta, as of 04/30/2009.
(5) Leverage Factor: 1+ (1- tax rate) x (Debt/ Total Capital).
(6) Unlevered Beta: Beta / Leverage Factor.
(7) Total Capital = Debt + Shareholder's Equity.
(8) Levered Beta x Leverage Factor
(9) Custo do Capital Proprio: Rf + B x (Rm - Rf).
WACC (Weighted Average Cost of Capital) calculated in nominal dollars of 11% to
12% p.a.
68
|
 |
Appendix B. Market multiples of comparable companies
69
|
 |
Market multiples of comparable companies
(in local currency, in millions)
Company Average Daily Net Value of alue of
Trading Volume (1) Debt Shares ompany EV / EBITDA 2010E EV / EBITDA 2011E
Companies Selected
--------------------------------------------------------------------------------------------------------------------------------------------
Brazil
Sao Martinho((1)) 0.73 918 1,436 2,354 6.5x 6.0x
Acucar Guarani((1))
1.42 744 363 1,107 2.9x 1.8x
Average 4.7x 3.9x
Median 4.7x 3.9x
Foreign
Agrana Beteiligungs AG((2)) 0.51 656 689 1,345 7.5x 7.0x
Associated British Foods PLC((3)) 39.36 1,143 5,293 6,436 6.0x 5.6x
CSR Ltd.((4)) 12.98 1,340 1,669 3,009 5.8x 4.8x
Danisco A/S((1)) 13.99 10,400 8,367 18,767 9.7x 8.9x
Ebro Puleva S.A.((5)) 9.23 1,165 1,427 2,593 8.4x 7.9x
Greencore Group PLC((3)) 0.88 283 166 449 4.3x 4.1x
Illovo Sugar Ltd.((4)) 2.60 3,240 9,261 12,501 6.2x 5.5x
Suedzucker AG((2)) 112.31 1,709 2,849 4,558 6.6x 6.3x
Tate & Lyle PLC((4)) 159.64 1,128 1,248 2,376 5.2x 5.4x
Tongaat-Hulett Ltd.((5)) 5.60 2,356 7,363 9,719 6.1x 5.5x
Bajaj Hindustan Ltd.((3)) 125.63 36,635 9,529 46,164 7.5x 6.6x
Balrampur Chini Mills Ltd.((3)) 101.49 13,155 16,997 30,153 6.6x 6.1x
Average 6.7x 6.1x
Median 6.4x 5.9x
Total Average 6.4x 5.8x
Total Median 6.4x 5.8x
--------------------------------------------------------------------------------------------------------------------------------------------
(1) Fiscal year from May to April
(2) Fiscal year from March to February
(3) Fiscal year from October to September
(4) Fiscal year from April to March
(5) Fiscal Year from January to December
Source: Reports from companies and Bloomberg as of 30th April 2009.
70
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 |
Description of comparable countries
To evaluate NovAmerica and Cosan based on market multiples of comparable
companies, listed companies from the sugar and ethanol sectors in Brazil and
worldwide were employed.
Sao Martinho: A producer of sugar and ethanol in Brazil founded in 1938.
Acucar Guarani: Company from the Brazilian sugar-alcohol sector since 1976 which
converts sugar cane into sugar, ethanol and electricity.
Agrana Beteiligungs AG: Austrian Holding in the sugar, pulp and fruit sector.
Associated British Foods PLC: International foodstuffs retailer which operates
in four business segments: Sugar&agriculture, retail, groceries e ingredients.
CSR Ltd.: Australian companies also with operations in New Zealand. Operates in
construction and sugar segments.
Danisco A/S: Company based in Denmark, works in the development, manufacture and
trade if food ingredients, sugar etc.
Ebro Puleva S.A.: Spanish company focused on the food sector with sugar-based,
dieting products etc.
Greencore Group PLC: Irish company specialized in producing foodstuff products.
Illovo Sugar Ltd.: Global sugar and ethanol producer, producing around 5.7
million tons of sugar cane on its plantations in South Africa, Malawi, Zambia,
Tanzania, Mozambique and Swaziland.
Illovo Sugar Ltd.: Global sugar and ethanol producer, producing around 5.7
million tons of sugar cane on its plantations in South Africa, Malawi, Zambia,
Tanzania, Mozambique and Swaziland.
71
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 |
Description of comparable countries (cont'd)
To evaluate NovAmerica and Cosan based on market multiples of comparable
companies, listed companies from the sugar and ethanol sectors in Brazil and
worldwide were employed.
Suedzucker AG: German company focused on production of supplies for the food
industry, operating sugar production units in several European companies.
Tate & Lyle PLC: English company specialized in development, manufacture and
trading of food stuffs and industrial supplies from sustainable sources.
Operates an dedicated sugar and Sucralose division.
Tongaat-Hulett Ltd.: South African company from the agricultural sector, owns
sugar plants in South Africa, Mozambique, Zimbabwe and Swaziland, derived from
sugar cane and manioc plantations.
Bajaj Hindustan Ltd.: Indian company focused on sugar and ethanol manufacture,
has 10 plants located in the North of India.
Balrampur Chini Mills Ltd.: Indian company manufacturer of sugar and ethanol.
72
|
 |
Appendix C. Description of the applied evaluation methodologies
73
|
 |
A. Discounted Cash Flow
CS assessed NovAmerica and Cosan using the discounted cash flow method ("DCF")
Methodology
o Unlevered cash flow method
- Projection of unleveraged cash flows
- The cash flows are discounted by the weighted average cost of capital
(WACC), to calculate their current value
Projections
o CS has employed, for evaluation purposes, the operational and financial
projections provided and/or discussed with the administrative teams of
NovAmerica and Cosan in nominal R$
Currency
o Projections in nominal R$
o The unlevered cash flow is converted each year to US$ in order to be
discounted
Discounted Cash Flow
o Base date: April 30th 2009; cash flows are converted to current value of
April 30th 2009
o Projection Horizon: 2009/2010 to 2018/2019
o Assumes flows are generated throughout the year ("mid-year convention")
o Discounted cash flow in nominal US$
74
|
 |
A. Discounted Cash Flow for the company ("DCF")
[GRAPHIC OMITTED]
75
|
 |
A. WACC Calculation
The WACC was calculated based on the combined cost of own capital (Ke) and the
cost of debt (Kd) estimated for the companies analyzed, considering a target
capital structure.
o Ke was estimated by the appraiser based on the CAPM model - Capital Asset
Pricing Model, adjusted for country risk
o Kd was estimated by the appraiser considering credit risk and the debt
market situation
[GRAPHIC OMITTED]
76
|
 |
B. Market multiples of comparable companies
Assesses the enterprise based on market multiples of other public companies with
similar operational and financial characteristics
o After selecting the universe of comparable companies, the implicit value of
the firm and of the share of the enterprise being evaluated is calculated
by multiplying its metrics (e.g.: net profit, EBITDA) by the respective
multiples of the universe of comparables
o The value of the comparable companies typically does not incorporate
"control" premiums reflected in mergers and acquisition transactions
involving comparable companies
o The key element in the analysis of comparable companies is identifying
those of greatest comparability and relevance
- A good comparable company is that which has operational and financial
characteristics which are similar to the company under evaluation
- Examples of operational characteristics include: Sector of activity,
products, markets, clients, seasonality and cyclicality
- Examples of financial characteristics: Size, leveraging, shareholder
base, growth and margins [GRAPHIC OMITTED][GRAPHIC OMITTED]
77
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 |
Appendix D. Terms and definitions used in the appraisal report
78
|
 |
Terms and definitions used in the evaluation report
Capex: capital expenditures, or investments in maintaining and/or expanding
capacity.
EBIT: earnings before interest and taxes, means, pertaining to a given period,
the sum of operating profits before deducting financial and tax costs.
EBITDA: earnings before interest, taxes, depreciation and amortization, means,
pertaining to a given period, the sum of operating profits before deducting
financial, tax, depreciation and amortization costs.
Greenfield: term referring to projects run in locales which have no such
activities or operations. LTW: last twelve months.
USDA: United States Department of Agriculture.
VHP: very high polarization, refers to raw sugar, which can be transformed into
different types of sugar, being used as raw material for manufacturing
processes.
WACC: weighted average cost of capital.
79
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 |
BANCO DE INVESTIMENTOS CREDIT SUISSE (BRASIL) S.A.
Avenida Brigadeiro Faria Lima, 3064 -14 no andar
01451-000 Sao Paulo, SP
+55 11 3841 6000
www.credit-suisse.com
80
|
EXHIBIT
II
ECONOMIC-FINANCIAL
APPRAISAL REPORT
|
Curupay
S.A. - Participações
Accounting
Appraisal Report for Purposes of
Merger
of Curupay S.A. - Participações by
Cosan
S.A. Indústria
e Comércio
May
28, 2009
|
|
Deloitte
Touche Tohmatsu Auditores
Independentes
|
 |
Deloitte
Touche Tohmatsu
Av. Dr. José
Bonifácio Coutinho
Nogueira, 150
- 5° - Sala 502
13091-611 -
Campinas - SP Brazil
Phone: +55 (19) 3707-3000
Fax: +55 (19) 3707-3001
www.deloitte.com.br
|
ACCOUNTING
APPRAISAL REPORT OF CURUPAY S.A. PARTICIPAÇÕES’ NET ASSETS ON APRIL 30, 2009,
FOR PURPOSES OF MERGER BY COSAN S.A. INDÚSTRIA E COMÉRCIO
|
I.
|
INTRODUCTION
|
|
Deloitte
Touche Tohmatsu Auditores Independentes, a simple private society,
headquartered in the city and state of São Paulo, at Rua José Guerra, 127,
Chácara Santo Antonio, Regional Accounting Council of the State of São
Paulo register no. 2 SP 011.609/O-8 and at the Brazilian Securities and
Exchange Commission no. CVM00385/9, and with a branch in the City of
Campinas, State of São Paulo, at Av. José Bonifácio Coutinho Nogueira,
nº.
150, 5o
andar - Sala 502 - Fazenda São Quirino, Corporate Taxpayer ID (CNPJ) no.
49.928.567/0011-93, and its consolidated articles of incorporation
registered on the 3rd
Civil Registry of Legal Entities of São Paulo, on December 28, 1977, and
further amendments registered in the same Civil Registry, the last of
which registered under no. 573008, on September 16, 2008, herein
represented by the partner Helio Wellichen, Brazilian, judicially
separated, accountant, bearer of the Brazilian Identity Card (RG) no.
7.529.506 SSP-SP, Individual Taxpayer’s Register (CPF) no. 838.978.288-04
and Regional Accounting Council of the State of São Paulo no. 1SP130
122/O-0, business address in the City of Campinas, State of São Paulo, at
Av. Dr. José Bonifácio Coutinho Nogueira, 150 - 5º.
Andar - Sala 502 - Fazenda São Quirino, CEP 13091-611, specialized
company, hired as an expert by the shareholders of Curupay S.A. -
Participações, closed joint-stock company, located in the city of Tarumã,
State of São Paulo, at Fazenda Nova América, s/no,
Bairro Água da Aldeia, Rodovia Miguel Jubran, SP 333, Tarumã/Assis way, Km
418 + 500 meters, at the right at Rodovia Antonio Maia, Frutal do Campo
way, + 8 Km, Zona Rural, CEP 19820-000, Corporate Taxpayer ID (CNPJ/ME)
no. 09.460.704/0001-11, with the last amendment of its Articles of
Incorporation carried out at the Annual and Extraordinary General Meeting
held on April 30, 2009, with its registry in process, receipt no.
0.429.502/09-6 at the Trade Board of the State of São Paulo, dated May 28,
2009, to proceed with the assessment, in compliance with article 8, Law
6,404, of December 15, 1976, amended by Law 10,303, of October 31, 2001
and Law 11,638, of December 28, 2007, at book values, of values attributed
to its equity, for purposes of merger with Cosan S.A. Indústria e
Comércio, publicly held joint-stock company, located in the City of
Pirabicaba, State of São Paulo, at the Cosan Administrative Building,
Bairro Costa Pinto, s/no,
Corporate Taxpayer ID (CNPJ/ME) no. 50.746.577/0001-15 and
Corporate Registry ID (NIRE) no. 35300177045, with the last amendment to
its Articles of Incorporation carried out at the Extraordinary General
Meeting held on January 30, 2009, registered at the Trade Board of the
State of São Paulo no. 48.860/09-8, dated February 9, 2009, presents below
the result of its works.
|
|
|
II.
|
OBJECTIVE
|
|
The
objective of this appraisal report of the accounting balances of the
values attributed to the net assets of Curupay S.A. Participações on April
30, 2009, is the merger with Cosan S.A. Indústria e
Comércio.
|
Deloitte Touche
Tohmatsu
|
III.
|
WORK
SCOPE
|
|
The
accounting appraisal report is being issued together with the examination
of the balance sheet of Curupay S.A. – Participações, examined on April
30, 2009, and prepared under the responsibility of the Company’s
Management.
|
|
|
Our
examination was carried out in accordance with the auditing procedures
applicable in Brazil and included: (a) planning the works, taking into
consideration the relevance of balances, the volume of transactions and
the accounting and internal control systems of the Company; (b) the
verification, based on tests, of the evidences and records supporting the
accounting values and information which were made available; and (c) the
appraisal of the most substantial accounting practices and estimates
adopted by the Management of the Company.
|
|
|
IV.
|
CONCLUSION
|
|
Based
on the works performed, we conclude that the book balance of the values
attributed to the net assets of Curupay S.A. Participações, summarized in
Attachment I, is three hundred thirty-four million, one hundred
seventy-two thousand Reais (RS334,172,000.00) on April 30, 2009, and are
recorded on the accounting books, in accordance with the accounting
practices adopted in Brazil.
|
|
|
V.
|
INEXISTENCE
OF CONFLICT OF INTEREST AND LIMITATIONS
|
|
According
to Article 5 CVM Rule 319, of December 3, 1999, we confirm
that:
|
|
a)
|
Pursuant
to the Professional rules established by Resolution 821/97 of the Federal
Accounting Council (CFC), we are not aware of any direct or indirect
conflict of interest referring to Curupay S.A. - Participações or the
services described above; we have no direct or indirect interest in the
abovementioned companies or any company related to
them.
|
|
b)
|
We
are not aware of any action by the controlling shareholder or by the
managers of the Company aiming to guide, limit or hinder, or practice any
acts which have or may have compromised the access, the utilization or
knowledge of information, assets, documents or work methodology relevant
to the quality of the respective
conclusion.
|
The
appraisal report herein is registered is three (03) equal copies, for the
effects of the Law to be in effect.
Campinas,
May 28, 2009.
|
DELOITTE
TOUCHE TOHMATSU
|
Helio
Wellichen
|
|
Auditores
Independentes
|
Accountant
|
|
CRC
2 SP 011609/0-8
|
CRC
1 SP 130122/0-0
|
|
Curupay S.A.
- Participações
|
ATTACHMENT
1
|
CURUPAY S.A. NET
ASSETS – INTEREST ON APRIL 30,
2009
|
ASSETS
|
R$
|
|||
|
CURRENT
ASSETS
|
||||
|
Cash
and banks
|
100,270.38 | |||
|
NON-CURRENT
ASSETS
|
||||
|
Permanent:
|
||||
|
Investments
|
334,071,729.62 | |||
|
Total
non-current assets
|
334,071,729.62 | |||
|
TOTAL
ASSETS
|
334,172,000.00 | |||
|
ACCOUNTING
NET ASSETS
|
334,172,000.00 |