- Company has more money to invest as it stops servicing debt
- Management is working to submit recovery plan before deadline
Oi SA is sticking to its year-end goals of tripling subscribers who use multiple services and boosting investments by 25 percent even as the phone carrier works through Brazil’s biggest-ever bankruptcy, Chief Executive Officer Marco Schroeder said.
The company is current in payments to suppliers and aims to continue on that front to guarantee service to customers during the bankruptcy process, Schroeder said in his first-sit down interview since taking the helm of the Rio de Janeiro-based operator a month ago. In March, Oi offered a package of mobile, landline, broadband and pay-TV services for customers across the country. Oi Total had 320,000 subscribers as of June and aims to reach 1 million this year, the company said.
“We are working for Oi’s bankruptcy protection to be a case of success,’’ Schroeder said. “Shareholders, debtholders, Anatel, everybody wants to maintain a healthy operation,’’ he said, referring to the country’s telecommunications regulator.
Oi filed for protection in June after failing to reach a restructuring agreement with creditors covering 65.4 billion reais ($20 billion) of debt. As it stops servicing its debt, Oi will have more cash to invest in its business, Schroeder said. The company plans to spend 5 billion reais this year, compared with 4 billion reais in 2015.
“The longer we stay current with our payment, the safer our suppliers feel that we will continue paying our bills,’’ Schroeder said. The company is moving forward on discussions with creditors and aims to present a recovery plan to the court before a 60-business day deadline, he said. He declined to comment on a group of creditors, advised by New York-based investment bank Houlihan Lokey Inc., that is said to have formed to oppose the reorganization plans on the table.
Oi’s management is also facing criticism from one of its biggest investors over the company’s board makeup. It has until July 15 to answer a request from Nelson Tanure’s Bridge Administradora de Recursos Ltda. for a shareholders’ meeting at which it would seek to oust directors who represent Pharol SGPS SA, the Portuguese holding company that is Oi’s largest shareholder, according to Oi’s website.
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 could reach into October.