USJ Completes Liability Management Transaction and Consent Solicitation

November 4, 2016

Cleary Gottlieb represented dealer managers J.P. Morgan Securities LLC and HSBC Securities (USA) Inc. in connection with the recent offer to exchange any and all of the outstanding $275 million 9.875 percent senior notes due 2019 of U.S.J. – Açúcar e Álcool S.A. (USJ) and in successful concurrent solicitations of consents from eligible holders of USJ’s outstanding notes. 

The offer to exchange any and all of USJ’s outstanding 9.875 percent senior notes due 2019 for newly issued 9.875 percent/12.00 percent senior secured PIK Toggle Notes due 2021—as well as its concurrent solicitation of consents (i) to certain proposed amendments to the indenture dated as of November 9, 2012, by and among USJ, the guarantor, the trustee and the Irish paying agent thereto and (ii) for approval of an extrajudicial reorganization plan for filing before Brazilian courts if USJ did not obtain the necessary approvals for the offer—launched on March 15, 2016.

USJ achieved nearly 90 percent participation by the expiration date of May 16, 2016, and successfully completed the offer and settled the transaction on May 17, 2016. The principal aggregate amount of the new notes is $197.032 million. USJ decided not to file for judicial reorganization.

USJ is a leading sugar and ethanol producer in the Center-South region of Brazil, with an aggregate sugarcane crushing capacity of 3.8 million tons per harvest year. USJ purchases, cultivates, harvests and processes sugarcane, from which its produces mainly crystal sugar and anhydrous ethanol. USJ also cogenerates electricity to power its industrial operations.