Brazilian sugar and ethanol producer Raízen SA is considering an out-of-court restructuring process as it grapples with mounting debt problems. The company said shareholders Shell Plc and Cosan founder Rubens Ometto have pledged to inject a combined 4 billion reais ($765 million) to stabilize its finances.

Raízen's controlling shareholders failed to reach agreement on a broader rescue plan, with private equity funds managed by Banco BTG Pactual SA withdrawing from talks. The company has struggled with high interest rates, weaker harvests, and heavy investments that have yet to generate expected returns. Total net debt reached 55.3 billion reais by year-end, up 43% from the previous year.

The deteriorating balance sheet has triggered multiple credit-rating downgrades and a steep selloff in bonds. Brazilian President Luiz Inácio Lula da Silva personally convened meetings with executives involved in rescue talks, highlighting the national significance of the situation. The company's leverage ratio climbed to 5.3 times earnings before interest and taxes, up from 3 times a year earlier.