Bunge Wholesaler Forms Bioenergy Company with BP

(Reuters) – Bunge Ltd, a US grain trader announced Monday that it has agreed to create a bioenergy company with BP Plc which will produce ethanol and sugar, and produce renewable electricity.

The joint venture, BP Bunge Bioenergia, will operate autonomously, with a total of 11 plants located in Brazil's southeastern, northern and central-western regions, Bunge said.

"This partnership with BP represents a major step in portfolio optimization for Bunge, which allows us to reduce our current exposure to candy …," said Bunge CEO Gregory Heckman in a statement.

Bunge said it would receive a cash proceeds of $ 775 million (£ 621.7 million) as part of the deal, which should help reduce debt.

The company will have a combined shredding capacity of 32 million metric tons per year and will produce renewable electricity powered by the residual biombad of sugar cane to power its sites and sell the surplus to the power grid. Brazilian.

The new company is expected to be based in Sao Paulo and the transaction is expected to close in the fourth quarter of 2019.

(Report by Shradha Singh in Bengaluru, edited by Arun Koyyur)