From Sorocaba’s factory to national conglomerate: an analysis of the history of the Votorantim Group (1891-1980)

Abstract

Votorantim, one of the main business groups operating in the Brazilian economy, has its origin dating back to 1891, when the União de São Paulo bank created the Votorantim Textile Factory in the city of Sorocaba. With the bankruptcy of Banco União in 1917, the company was auctioned and, in subsequent years, its shareholding control was acquired by the Portuguese Antonio Pereira Ignácio, an important industrialist of the São Paulo textile sector, who made of Votorantim the leading company in the cotton textile industry. However, from the 1930s onwards, the Votorantim Group began to concentrate its efforts on the intermediate goods sector – cement, chemicals, aluminum, steel and iron – through the constitution of the following companies: Santa Helena Cement (1936), Barra Mansa Steelworks (1937), Nitro-Chemical Company (1937) and the Brazilian Aluminum Company (1955). Given the lack of analysis on how the Votorantim Group’s conversion from the final consumer goods sector to the basic industry took place, the article addresses this shift by highlighting: the correlation between the Group and President Getúlio Vargas’s industrial project, the pre-existing productive resources and the industrial expertise of its leaders. The research is based on primary documentation consisting of: Votorantim Group management reports, profit and loss statements and balance sheets. As a result, the article contributes to the debate on the formation of economic groups in peripheral economies by demonstrating that, in the case of Votorantim, the Group’s own revenue generation was the main financing instrument for the creation of new companies in the sector of intermediate goods in Brazil.