Amyris' feedstock supplier changes hands in Brazil

By Susanne Retka Schill | March 25, 2013

Tonon Bioenergia in Brazil announced the purchase of Paraiso Bioenergia, a sugar and ethanol producer with a single 2.5 million metric ton (mmt) sugarcane mill. The addition of a third mill will increase Tonon’s capacity by 30 percent to 8.2 mmt harvested in 2013-’14 which is expected to increase to 9.6 mmt by 2015-’16. About 75 percent of the sugarcane crushed in the facilities is owned by the company. Combined ethanol production at the three facilities for 2012 totaled 244,000 cubic meters (608 MMgy).

The acquisition brings with it a new partnership for Tonon. Biomass-based chemical producer Amyris Inc., began producing renewable farnesene, trademarked Biofene, in December at its new plant in Brotas with sugar feedstocks supplied by nearby Paraiso.

"Tonon Group's proposed acquisition of the sugarcane feedstock supplier of our Biofene plant underscores the confidence in our business model and our ability to add value to the Brazilian sugarcane industry with renewable fuels and chemicals," said Paulo Diniz, president of Amyris Brasil. "While this change of control does not affect our operations in Brotas, we are pleased with the financial strength and growth strategy of the Tonon Group as well as their ability to secure additional sugarcane syrup to support our growth," Diniz added.

"Amyris's successful operations and strategic relationship were important factors in our decision to acquire the Paraiso sugarcane mill," said Rodrigo Aguiar, CEO of Tonon Bioenergia. "This acquisition represents an important element of Tonon's growth strategy, building on our two existing sugarcane mills in Brazil."

In making the announcement, Tonon said the location of Paraiso within 40 kilometers (24 miles) of its Santa Candida mill in the state of Sao Paulo, would provide cost saving synergies derived from a centralized agricultural operation. The purchase is pending regulatory approval.

Amyris began the Brazilian operations in December, making its first shipment of product in early 2013. The company was founded in 2003 by a group of scientists at the University of California-Berkeley, working in synthetic biology to modify the way yeast process sugar. The first petrochemical replacement developed by Amyris, renewable farnesene, can be used in a wide range of products from cosmetics, perfumes, detergents and industrial lubricants, to transportation fuels