By Brazil Stock Guide – Cosan SA (B3: CSAN3) will not inject capital into Raízen SA (B3: RAIZ4), Chief Executive Officer Marcelo Martins said, signaling that the holding company’s stake in the biofuels and sugar producer is likely to shrink significantly in the coming years.
The comments were made during Cosan’s first-quarter 2026 earnings call, according to Valor Econômico. Martins said Raízen’s extrajudicial recovery process is being led by the company itself, while Cosan is following the talks with creditors as a shareholder.
“We continue to follow Raízen’s extrajudicial recovery process. Talks with creditors have been progressing. Obviously, this is a process being conducted by the company itself. We, as shareholders, have been monitoring this very closely,” Martins said.
The executive said Cosan’s decision not to provide additional capital remains in place. Given the expected conversion and the capital contribution by Shell Plc (LSE: SHEL; NYSE: SHEL), Cosan’s partner in Raízen, the move should result in a substantial reduction of Cosan’s ownership.
That would leave Cosan with a minority stake in Raízen, Martins said. The company is still assessing whether it will hold only common shares or a mix of common and preferred shares.
“We are still deciding whether we will have only common shares or whether we will have common and preferred shares. This is also part of the process. But, in any case, even if we only have common shares, our stake should not be significant,” he said.
Martins also indicated that Cosan may eventually sell the remaining stake. He said there is no defined timeline and no formal decision to divest, but added that the asset is expected to lose strategic importance for the group.
“We do not know what that horizon is, and we do not yet have a concrete decision that we will sell. But I would say the trend, especially considering that it will be a reduced stake, is that [Cosan] will not be part of a shareholders’ agreement. This will no longer be a relevant investment, and we will, yes, seek liquidity at some point,” he said.
Cosan also said it has stopped recognizing Raízen’s effects in the holding company’s financial statements. The move comes as the group prioritizes debt reduction and asset sales over dividends from subsidiaries as its main deleveraging strategy.
Martins said it is “quite reasonable” to assume that Cosan, as a holding company, could cease to exist within three to five years. Under that scenario, businesses currently under Cosan’s umbrella would grow directly through their operating companies, which could receive capital independently.
“Within this three-to-five-year horizon, I think it is quite reasonable to say that Cosan will cease to exist, that is, as we conclude the divestment process and reduce leverage, we will subsequently understand effectively what assets and liabilities remain within the company and, immediately afterward, we will probably distribute the stakes directly to shareholders,” Martins said.
The CEO said the plan had already been announced in 2025, when Cosan carried out a capitalization. The current priority, he said, is to reduce debt. He described the initial public offering of Compass as a key step and said other measures are expected in the coming months.
“The first step is debt reduction, and that is our current objective. The IPO of Compass is a very relevant step, and there are other steps we will follow in the coming months, with the objective of being able, already this year, to show a substantial debt reduction, leaving for next year, eventually, some residual balance,” he said.
If the plan advances, Martins said it would be fair to consider the start of a holding-company dissolution process from next year, depending on market assumptions and investment feasibility. Cosan’s management reiterated that its core deleveraging strategy is based on selling stakes in portfolio companies, rather than relying on dividends from controlled businesses.
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