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Cosan Downgraded to Ba3 by Moody’s
February 25, 2026
Cosan S.A. was downgraded by a notch to Ba3 from Ba2 by Moody’s. The rating action reflects heightened uncertainty surrounding the financial situation and planned capital restructuring of Raizen, which Cosan jointly controls with Shell. Although Cosan does not guarantee Raizen’s debt, the subsidiary’s deteriorating credit profile has increased risk perception across the group. Moody’s noted that Cosan’s stakeholders are likely to remain more cautious while observing developments at Raizen, which may delay or restrict asset sales and market access terms for Cosan and its key subsidiaries. Raizen is dealing with high leverage, weak operating performance and liquidity pressures, raising the possibility of a distressed exchange or a default-like transaction. Moody’s expects Raizen will not distribute dividends for at least the next two harvest cycles, increasing Cosan’s reliance on cash flows from other subsidiaries such as Compass and additional portfolio companies. Despite the downgrade, Cosan’s credit rating is supported by a diversified business portfolio across the sugar-ethanol value chain, fuel distribution, natural gas, lubricants and logistics. Its liquidity improved after a BRL10.5bn ($2bn) capital injection and broader dividend sources from subsidiaries.
It’s 8.25% Perp was trading with a negative bias, down by 0.2 points to 98.9 yielding 14.27%.
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