Brazil Cosan to try share swap, delisting again

SAO PAULO, March 5 (Reuters) - Brazil's biggest sugar and ethanol group, Cosan, on Wednesday offered shareholders in its locally-listed unit to swap their shares for stocks in a foreign-registered subsidiary in a new attempt to overhaul its structure and gain scale globally.

Each share in Cosan SA (CSAN3.SA) will be swapped for one Brazilian Depositary Receipt or stock in the Bermuda-registered Cosan Ltd (CZLT11.SA)(CZZ.N), set up last year.

If the plan is successful, Cosan SA will be delisted from the Sao Paulo Stock Exchange's New Market, which requires an increased level of transparency from its participants.

Under the planned shareholding change that raised some eyebrows among Brazilian investors when first announced last year, Cosan Chief Executive Rubens Ometto Silveira Mello will shift his controlling stake in the Brazilian firm to the Bermuda-registered company.

Cosan said the restructuring will give it more "opportunities of growing in various markets and regions in the sugar and ethanol sector using a global platform."

At least two-thirds of shareholders have to subscribe to the share swap, or it risks failing as it did last July, when too few stockholders adhered to the plan.

Cosan Ltd's initial public offering in mid-2007 raised only about half the funds the company had been hoping for. Cosan raised the money in the IPO to finance the construction of new mills to keep up with soaring demand for biofuels like ethanol made from sugar cane.

Before the swap announcement, Cosan SA stocks had closed 4.5 percent higher at 31.80 reais, while Cosan Ltd rose 2.3 percent to 26.09 reais. In New York, Cosan Ltd rose 2.58 percent to $15.53.

($1=1.67 reais) (Reporting by Aluisio Alves and Andrei Khalip; editing by Carol Bishopric)