S&P downgrades Cosan's rating following the impact of Raízen's restructuring.

S&P Global Ratings, one of the world's leading credit rating agencies, downgraded Cosan's rating from BB- to B+ and maintained a negative outlook for the company.

S&P ratings are used by investors to measure companies' ability to meet their financial obligations and directly influence the cost of raising capital in the market.

With this decision, Cosan remains in the speculative grade category, considered the highest risk by investors. The main reason for the downgrade continues to be the financial situation of Raízen, one of Cosan's main subsidiaries. holding.

In March of this year, the company filed for out-of-court restructuring to restructure approximately R$ 65 billion in debt.

Raízen files for out-of-court restructuring to restructure R$ 65 billion in debt.

According to S&P, although the contagion risks stemming from the out-of-court restructuring have decreased, the restructuring has permanently altered Cosan's business profile by reducing its economic stake in Raízen and weakening one of its main sources of cash generation and dividend distribution.

The recovery plan, approved by more than 80% of creditors, foresees the restructuring of approximately R$ 65 billion in debt, including a R$ 3,5 billion contribution from Shell, an additional R$ 500 million option for the Ometto family's holding company, and the conversion of 45% of the debt into equity.

Cosan has chosen not to participate in Raízen's capital increase. The decision reduces the need for new outlays, but also diminishes its influence over the company.

Loss of dividends puts pressure on the holding company.

According to the agency's assessment, the reduction in its stake in Raízen structurally compromises Cosan's ability to generate cash. In March of this year, the holding company stopped recognizing the subsidiary's results in its accounting after recording losses that reduced the value of the investment to zero.

In practice, the company loses one of its main sources of dividends, increasing pressure on its financial structure. S&P highlights that Cosan has reduced its debt by approximately R$ 9 billion since the end of 2025, a move made possible through asset sales, share offerings, and the Compass IPO.

Even so, the agency projects that interest coverage ratios will remain below 1,0x over the next two years if the company does not undertake any further divestments.

This is because the expected dividends from companies like Rumo, Compass, Moove, and Radar would not be enough to cover the holding company's financial expenses.

Maintaining a negative outlook reflects uncertainties regarding the asset sale plan and the impact it may have on Cosan's future cash flow generation.

In addition to financial factors, S&P believes that the way the Raízen crisis was handled could generate lasting reputational effects for the holding company, influencing investors' risk perception and increasing the cost of future fundraising.

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