Corporate Governance
OVERVIEW
[GRI 2.3/ 2.9]
In February 2007, São Martinho shares began trading on the Novo Mercado, the BM&FBovespa’s highest corporate governance listing segment, under the ticker SMTO3. When joining the Novo Mercado, the Company undertook to comply with some of the most important and strictest listing regulations in the international markets, thus ensuring total transparency and equal treatment for all its shareholders.
In 2010, the Group completed the merger of Usina São Martinho S.A. (a wholly-owned subsidiary). As a result, São Martinho S.A. (the parent company) took over full responsibility for all activities related to the production of sugarcane, sugar, ethanol and their byproducts, and another wholly-owned subsidiary, Vale do Mogi Empreendimentos Imobiliários S.A., was constituted to take over the São Martinho mill’s land holdings. The idea behind the restructuring was to centralize the Group's activities and increase operational efficiency, especially in the financial and fiscal areas, as well as reduce administrative and operating costs.
Also as part of the corporate restructuring process, in 2011 São Martinho S.A. merged Omtek (another wholly-owned subsidiary) and took over responsibility for its activities, which consist of the production, sale and import/export of chemical and organic products, on its own behalf or on the behalf of third parties, as well as the production of animal feed additives, ingredients and supplements.
The other changes arising from the reorganization refer to the inclusion of the Group’s previously mentioned partnerships with Amyris Biotechnologies and Petrobrás Biocombustível S.A. The latter resulted in the creation of Nova Fronteira Bioenergia, the parent company of the Boa Vista Mill and SMBJ Agroindustrial.
The ownership structure below shows how the São Martinho Group is organized.
OWNERSHIP STRUCTURE OF SÃO MARTINHO S.A.
SHAREHOLDER BREAKDOWN
In August 2011, São Martinho announced to its shareholders that its controlling shareholders, Luiz Ometto Participações S.A., João Ometto Participações S.A and Nelson Ometto Participações Ltda. Had consolidated their holdings into a single holding company that would be the controlling shareholder of São Martinho S.A. The holding company, known as LJN Participações S.A., is a privately-held company that retains 56.12% of the Company’s capital stock, which is the result of the sum of the shares previously held by the controlling shareholders, calculated respectively at 26,134,286, 26,134,286 and 11,145,716.
The creation of the holding company resulted in a shareholders’ agreement that governs, among other issues, how the Company’s shares should be purchased and sold. The agreement further consolidates the São Martinho Group’s best practices of corporate governance. The table below shows the shareholder breakdown following the creation of LJN Participações.
| Shareholders | % of shares | |
| LJN Participações S.A. | 56.12 | |
| Indirect Controlling | 4.77 | |
| Shareholders Management | 3.57 | |
| Treasury | 0.63 | |
| Outstanding shares | 34.91 | |
| Total | 100.00 |
CLASSIFICATION OF THE COMPANY’S SHARES
In 2011, the São Martinho Group's shares were given a global rating of BB+ and a national rating of BrAA+ by the international ratings agency Standard & Poor's (S&P), known worldwide as leader in financial market intelligence services. The ratings reflect, among other factors, the company's conservative capital structure, the high agricultural productivity of its sugarcane plantations and its low sugar and ethanol production costs.