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MATERIAL FACT
Merger of Omtek

São Paulo, April 25, 2011 - São Martinho S.A. (Bovespa: SMTO3; Reuters: SMTO3 SA and Bloomberg: SMTO3 BZ) (“Company” or “São Martinho”), one of the largest producers of sugar and ethanol in Brazil, announces that its board of directors, as part of the ongoing ownership restructuring process, approved, ad referendum the Extraordinary General Meeting, the merger of Omtek - Indústria e Comércio Ltda. (“Omtek”).

The restructuring will not result in any changes in the company´s corporate purpose and will involve the merger of all assets of Omtek by São Martinho S.A. (its only partner), which will concentrate the activities developed by Omtek, which consist of the production, commercialization, export and import, on its own behalf or on the behalf of third parties, of chemical and organic products, as well as the production of additives, ingredients and supplements for animal consumption. More information will be made available in the Call Notice for the Extraordinary General Meeting to be held on May 30, 2011 and in the Management Proposal.

Once approved by Shareholders, the operation will result in the following benefits: (a) higher operational efficiency due to the centralization and consolidation of Omtek‘s activities by São Martinho; (b) stronger financial performance of São Martinho, with higher levels of competitiveness and productivity.

The merger will not result in a capital increase at São Martinho S.A., since the interests in Omtek are already recorded on its shareholder´s equity in the balance sheet.

Since the transaction consists of the merger of a wholly owned subsidiary, the Company, in compliance with CVM Instruction 319 of December 3, 1999, will opportunely disclose a new Material Fact with details of the operation, as stated in Article 2 of said Instruction.

Documents related to this operation will be available to the Company‘s shareholders as of May 12, 2011, at Rua Geraldo Flausino Gomes n° 61- cj. 132- Brooklin Novo, CEP 04575-060, in the city and state of São Paulo, during business hours (Monday through Friday from 8:00 a.m. to 6:00 p.m.). Information is also available by calling the Company’s Investor Relations Department at +55 (11) 2105-4140.

The documents provided by CVM Instruction 481/2009 and the information required by CVM Instruction 319/1999 will be presented to the Comissão de Valores Mobiliários (CVM) through the Sistema de Informações Periódicas (IPE) and will be available to the Company´s shareholders as of May 12, 2011, at the head office of the Company, on the Company‘s investor relations website (www.saomartinho.ind.br/ir) and on the websites of the CVM (www.cvm.gov.br) and the BM&FBovespa S.A. - Bolsa de Valores, Mercadorias e Futuros (www.bmfbovespa.com.br).

Cordially,

João Carvalho do Val
Chief Financial and Investor Relations Officer

Felipe Vicchiato
Investor Relations Manager

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