SINGAPORE - Indofood Agri Resources (IndoAgri) has invested 23.6 million Brazilian real ($9.6 million) to take a 50 per cent stake in a joint venture to acquire a sugar mill business in Brazil.

IndoAgri's partner, JF Investimentos, contributed an equal amount to the initial capital of the joint venture, Canapolis. IndoAgri is primarily an Indonesia-based palm oil producer, although it also engages in the cultivation of rubber, sugar cane and other crops.

In December 2017, Canapolis acquired a sugar mill in Minas Gerais, which has an annual cane crushing capacity of 1.8 million tonnes and 6,048 hectares of land. The acquisition was made through a court auction as part of bankruptcy proceedings for the asset's previous owner. The acquisition price was about 137.8 million real, to be paid in four instalments. The final payment is scheduled for June 2019.

Operations at the mill are expected to begin in 2020 following cane planting and rehabilitation of the mill. Capital expenditures for the setting up will be funded through bank borrowings.