Petrobras weighs stake in Raizen to return to ethanol mkt

SAO PAULO, Aug 17 (Reuters): Brazilian state-run oil company Petrobras is considering an investment in sugar and ethanol producer Raizen as a way to re-enter the ethanol market, local newspaper O Globo reported on Saturday, citing sources.
Petrobras had previously said it was eying a return to the ethanol sector after having announced in its 2017-2021 strategic plan it would no longer produce biofuels, while Raizen is open to a new partner as it faces financial hurdles.
Petrobras and Raizen did not immediately respond to requests for comment.
O Globo said Petrobras could make a decision by year-end. The oil company is studying several options, including joining Raizen as a partner or buying assets from the firm, the report added.
Raizen, the world's largest sugar maker and a leading ethanol producer, is controlled by Shell and Brazilian conglomerate Cosan. The company also has businesses in the fuel distribution sector.
Raizen earlier this week acknowledged the possibility of a new shareholder after reporting weak results, which caused its stock to plunge to a record low. Cosan said bringing in a new partner for the company was "an option we like."