Braskem Rejects Bondholder Debt Restructuring Proposals
Braskem S.A. responded to a B3 request for clarification regarding news reports about its debt restructuring efforts. The company confirmed it rejected two non-binding proposals from bondholders, including U.S. investment fund Elliott, to restructure its approximately R$50 billion debt. One proposal involved a debtor-in-possession financing facility that could lead to significant shareholder dilution, while the other suggested extending bond maturity with all assets pledged as collateral. Braskem stated these terms were "far from acceptable" and that controlling shareholders would not accept a restructuring leading to a loss of control. The company is continuing discussions with financial creditors for a consensual solution and has secured a 60-day stay on creditor enforcement actions.
Key Highlights
- Braskem rejected bondholder proposals for its approximately R$50 billion debt restructuring.
- One proposal involved a debtor-in-possession financing facility with potential debt-to-equity conversion.
- This conversion could significantly dilute controlling shareholders to less than 10%.
- Another proposal suggested extending bond maturity with all company assets pledged as collateral.
- Braskem deemed the proposed terms "far from acceptable" and would not accept loss of control.
- The company is continuing discussions with financial creditors for a consensual solution.
- A court granted a 60-day stay on creditor enforcement actions during mediation.
Price Impact
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