End of September is deadline for Farm Rio acquisition bids

Farm Rio, a key brand within the Azzas 2154 (Azzas) group, recently dissolved its merger with Soma. The brand, which is now being considered for sale, is receiving non-binding proposals until the end of September. It is worth noting that following the demerger, Farm Rio will become an independent entity, with capital from both controllers, Alexandre Birman and Roberto Jatahy.

The process is being managed by Morgan Stanley. According to an article on the Araçatuba Commercial and Industrial Association portal, it is primarily attracting interest from private equity funds, including Advent, GIC, CVC and L Catterton.

Morgan Stanley has therefore set the end of the current month as the deadline for interested parties to submit their offers. The proposals are non-binding but indicate the market's direction. According to the portal, private equity funds have been leading this interest due to the brand's positioning and its international presence, operating in 18 countries.

In 2025, Farm Rio had a turnover of 3.4 billion reais, equivalent to 23 percent of the gross revenue of Azzas for the year. The brand's valuation is estimated to be between 3.5 and 5.5 billion reais, according to valuations by Citi and Morgan Stanley, respectively.

The discrepancy in valuation and the transaction structure are considered obstacles and challenges for potential buyers. This is because systems, contracts and teams need to be separated within Azzas. Additionally, the role of the current controllers post-sale is another element in this complex equation. This could impact the final price and the sale timeline.

When contacted by the portal, Azzas responded that it does not comment on market speculation.