Oi SA , the bankrupt Brazilian phone company, is resuming negotiations with creditors and is working toward bringing a restructuring plan for more than $20 billion in debt to the courts in 60 business days, Chief Executive Officer Marco Schroeder said.
“Discussion will involve new types of debt, debt conversion into equity, bonds with longer and shorter maturity,” Schroeder said in a phone interview. “Now we are going back to the table and we won’t have a single proposal. We will have several so that investors can choose the ones that are more adequate to their profile.”
Schroeder and Oi Chief Financial Officer Flavio Nicolay Guimaraes were in New York Thursday meeting with the company’s adviser PJT Partners and with Moelis & Co., the investment bank hired to represent a group of Oi bondholders, according to Oi’s press officer.
The judge for the seventh corporate jurisdiction of Rio de Janeiro on Wednesday evening accepted Oi’s request for all of the company units to be part of the debt restructuring, including the Dutch ones that were being targeted by Aurelius Capital Management LP, a creditor. That started a 60-day clock ticking for Oi, which filed for the biggest bankruptcy protection request in Brazil’s history.
“We are pleased that the judge included our foreign units in the decision,” Schroeder said. “It is much easier to have a single process for all our units, as Oi has a single cash flow.”
Syzygy Capital Management, a unit of Aurelius, filed for an insolvency proceeding in a Netherlands court against Oi Brasil Holdings Cooperatief UA, one of Oi’s financial vehicles in the country, based on default of $800,000 in bonds, according to a Oi filing on June 28. The ruling also protects Portugal Telecom International Finance BV, another Oi unit.
Brazil telecommunications agency Anatel now has five days to present as many as five suggestions of companies to act as judicial administrator for the process. After the judge chooses the administrator -- which will probably be a big international consulting company -- the administrator has 15 days to present a list of creditors and they have 15 other days to question the amount.
Oi’s timetable to present a recovery plan may be extended because of the Olympic games, scheduled for August in Rio. If the state courts decide not to work during the games, the period can go to as far as October.