Macquarie Announces Investment Scheme That Will Form the Largest Independent Ag Port Terminals Opera

By Lynda Kiernan-Stone, Global AgInvesting Media

Macquarie Infrastructure Partners V (MIP V), an Americas-focused infrastructure fund managed by Macquarie Asset Management, announced an investment that will ultimately make Macquarie a controlling factor in the largest independent agriculture port terminals operator in Brazil.

MIP V has entered into an agreement to invest 500 million reais (US$91.9 million) in Brazilian port terminal operator Corredor Logística e Infraestrutura S.A. (CLI) via a primary issuance. Once closed, this deal would result in MIP V holding a 50 percent co-control stake in CLI along its current owner - funds managed by private equity manager IG4 Capital. In addition to this 50 percent ownership stake, MIP V stated it will also subscribe for new preferred shares issued by CLI.

CLI is one of the four operating companies controlling Maranhão Grain Terminal (“TEGRAM”) at Brazil’s Port of Itaqui - one of the country’s largest grain terminals. To this partnership CLI brings expertise as an independent operator with a focus on port logistics in the agribusiness sector, delivering excellence in grain export shipping services.

Brazil is already the top global exporter of soybeans, coffee, sugar, chicken, and beef, and is considered a major exporter of cotton, corn, and pork. In the first half of this year alone, the country has seen its corn exports increase by 221 percent as it moves to fill the supply gap created by a lack of exports out of Ukraine. Projections by the Foreign Agricultural Service of the USDA indicate that in the 2022/23 marketing year, Brazil is expected to break corn production and export records to reach 126 million tons in production and 47 million tons in exports.

The war in Ukraine has also opened up a new window of opportunity for Brazi’s farmers in the form of wheat. Not typically a major crop for Brazil, acreage has remained generally stable, increasing by only 6 percent between 2013-2020, according to the Department of Agricultural and Consumer Economics, University of Illinois. However, due to the ongoing conflict in the Black Sea, and the availability of new tropical, high-protein wheat varieties, expectations from Safras & Mercado are that Brazil will plant 3.6 million hectares of wheat - the largest acreage in 36 years.

In turn, MIP V’s investment in CLI will provide support for CLI to acquire an 80 percent controlling stake in Elevações Portuárias S.A. (EPSA) from Rumo S.A. (Rumo). Located in Santos, Brazil, EPSA is the largest bulk sugar and grain terminal in the country. Rumo, which is the largest railroad operator in the country, will retain the remaining 20 percent skate in EPSA, alongside CLI. Once completed, the combined CLI and EPSA entities will form a geographically diversified platform and the largest independent agriculture port terminals operator supporting the key grain and sugar production regions in Brazil.

Fernando Lohmann, managing director, Macquarie and head of Macquarie Asset Management in Brazil noted that Macquarie Asset Management has a long history of investment and experience in both global ports and the agricultural sector in Brazil, adding, “This opportunity represents a natural step in bringing those experiences together and working alongside capable partners to support CLI’s expanding role in one of Brazil’s most critical sectors.”

“The partnership with IG4 and Rumo, via this investment in CLI, demonstrates our confidence in Brazil’s potential to maintain its leadership role in the export of essential food products.”

Hélcio Tokeshi, CEO, CLI, commented, “I'm very proud to announce this new phase for CLI, which will grow from its current 4 million tons of export shipping capacity to more than 20 million tons,” concluding, “We are a fully independent terminal operator, providing high quality services to our customers in Itaqui, a standard which we will work to replicate in the newly acquired terminals in Santos.”

~ Lynda Kiernan-Stone is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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