Edition 1450
18 November 2017
Edition: 1450

Read this week's issue online exactly as it appears in print.

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Creditors of former PT associate Oi slam 'outrageous' board actions

by TPN/ Lusa, in News · 08-11-2017 07:31:00 · 0 Comments

Leading international creditors of Oi, a Brazilian mobile telecommunications operator that at one point was to have merged with Portugal Telecom, have criticised the rejection by the company's board of an alternative debt-restructuring plan they had presented.

Creditors of former PT associate Oi slam 'outrageous' board actions

 

“Unfortunately, despite the fact that the Creditors Revised Team’s ‘Term Sheet’ had been developed specifically to reflect the comments received from Oi group’s senior management, the majority of the company’s board of directors rejected it out of hand in the negotiations," the creditors said in a statement released to the media.

 

Creditors grouped in the International Bondholder Committee and the Ad-Hoc Group, together with FTI consulting, also said that the rejection showed "once more than [the board members] are drive by the objective of increasing the interests of existing shareholders, in detriment to the best interests of other parties.”

 

The creditors also described the appointment of two new members to the board at a meeting last Friday as “an outrageous violation of corporate governance standards”, alleging that they were appointed to make it more difficult to negotiate "fair rstructuring plans" and protect "the interests of the minority shareholders that exercise control of the company".

 

Oi, in which Portugal’s Pharol is the largest shareholder with 27%, was to have merged with Portugal Telecom, but the deal never went ahead. The company in June last year filed for bankruptcy protection in order to be able to restructure its debts, which at the time amounted to 65.4 billion reais (€17.3 billion).

 

The move came two months after Oi and several creditors had begun talks to restructure about 50 billion reais in debt that collapsed after key shareholders reportedly baulked at the prospect of seeing their stakes sharply reduced in any deal.

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Edition 1450
18 November 2017
Edition: 1450

Read this week's issue online exactly as it appears in print.

Twitter

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