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2 minutes read

Go ahead for construction of the 2nd cellulose factory in Três Lagoas,

The Federal Regional Court of the 4th Region accepted the request from J & F Investimentos, the brothers Joesley and Wesley Batista, and suspended the power of the Indonesian Jackson Wijaya’s group to veto investments from Eldorado Celulose. The decision authorizes the construction of the 2nd line of the cellulose factory in Três Lagoas, which will cost R$20 billion and is expected to generate 10,000 construction jobs.

Rapporteur of the appeal filed by Paper Excellence, judge Rogério Favreto considered that this arbitration resolution created governance mechanisms unknown under the Brazilian Corporation Law and gave the foreign company direct and indirect control over Eldorado, a Brazilian company that owns and leases rural land , without legitimacy.

The Aribitral Chamber had determined the handover of Eldorado to the multinational and also granted veto power over investments to be made by the company. However, the magistrate considered that the measure has no legal support and gave Eldorado complete autonomy to begin the expansion work at the Três Lagoas unit.

Followed by the other judges, Favreto ordered that the powers granted to Paper by arbitration be suspended until a definitive judgment is made on an action regarding the lack of prior legal authorization for the Sino-Dutch company to acquire Eldorado.

“Meanwhile, the management regime of the company Eldorado must be as provided for in the S/A Law and in accordance with its current corporate composition and deliberation bodies”, he determined when rejecting what he considered “strange and undue acts of the Arbitration Court ” who worked on the case.

The expansion of Eldorado and the completion of the Petrobras fertilizer factory are expected to generate a new boom in job creation in Três Lagoas and boost the economy of Mato Grosso do Sul over the next four years.

Petrobras confirmed that it will launch the notice to complete the work in December and should start producing urea and ammonia by the end of 2028.

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