SAO PAULO (Reuters) - Brazilian pulpmaker Fibria Celulose SA (FIBR3.SA) denied on Tuesday that the company or its shareholders were discussing a potential tie-up with rival Eldorado Brasil Celulose SA, but underscored their interest in eventual deals in the sector.
Chief Executive Marcelo Castelli said “there is no ongoing negotiation of any kind,” downplaying recent stories including a report in Valor Econômico on Tuesday that Fibria could form a partnership with Eldorado and its own nearby operations.
Netherlands-based Paper Excellence agreed in September to pay 15 billion reais ($4.7 billion) for Eldorado, a valuation that Fibria considered excessive and a “dealbreaker” in any merger or joint venture talks, Castelli said.
Still, he reaffirmed Fibria’s interest in being part of an eventual “consolidation” in the market, underscoring an openness to mergers of equals as well as outright acquisitions.
Eldorado and Fibria’s nearby plants at Tres Lagoas, in the state of Mato Grosso do Sul, have a combined capacity of nearly 5 million tonnes of pulp per year and annual revenue of roughly 10 billion reais ($3.2 billion), Valor reported, without citing sources for the information.
Fibria and Paper Excellence would have “distinct” stakes in the venture, Valor said, without elaborating.
Eldorado and Paper Excellence were not available for immediate comment.
Fibria shares rose nearly 2 percent in morning trading on Tuesday after rising 5 percent on Monday, following another news report floating a possible deal with Eldorado.
($1 = 3.17 reais)
Reporting by Brad Haynes, Alberto Alerigi Jr. and Ana Mano; Editing by Jason Neely and Bernadette Baum