- Owners of company’s unsecured debt to get just under 20 cents
- OAS 2019 bonds traded at 4.5 cents on dollar earlier this week
Brazilian construction company OAS SA won approval for its restructuring plan early Friday after agreeing to sell one of its most valuable assets in order to help pay creditors.
The vote, which had been scheduled and postponed on several occasions since September, went forward after OAS secured a deal to sell its stake in airport operator Invepar for at least 1.35 billion reais ($343 million), the company’s press office said. Debt secured by OAS Investimentos assets will get about 20 cents on the dollar, while debt with no such guarantee will recover just shy of 20 cents. OAS bonds due in 2019 traded at 4.5 cents on the dollar earlier this week.
OAS is one of the first companies to reach a deal with creditors after a widespread corruption investigation ensnared many of Brazil’s top builders and made it almost impossible for them to land new projects. Prosecutors accused executives from OAS and other construction companies of paying bribes in exchange for contracts with state-run oil company Petroleo Brasileiro SA. In November 2014, police jailed some of the industry’s most powerful executives. The probe has helped deepen the crisis in Latin America’s largest economy, putting it on pace for the worst recession since the 1930s.
The restructuring deal doesn’t free the company from further investigation. OAS confirmed on its website that federal police visited its offices Dec. 11 to perform a search and seizure regarding a suspicious contract. The company provided “all the information requested and was always at the disposal of the authorities,” it said, adding that it is displeased with the “unnecessary imprisonment” of Chief Executive Officer Elmar Varjao.