RIO DE JANEIRO/BRASILIA, Oct 25 (Reuters) - Shareholders in debt-laden phone carrier Oi SA were set to meet on Wednesday amid discussions within the Brazilian government on drafting an alternative restructuring proposal by Friday, according to people with knowledge of the matter.
The alternative plan is under negotiation between the government’s Solicitor General, telecoms regulator Anatel and state-controlled creditors such as Banco do Brasil SA and development bank BNDES, two of the sources said on the condition of anonymity due to the sensitivity of the matter.
One of the people said Brazil’s government is also in talks with Oi bondholders, which publicly rejected the company’s restructuring plan presented earlier this month.
A judge overseeing the bankruptcy protection proceedings agreed to a request by creditors to reschedule an assembly for November, giving time to reconcile competing restructuring proposals more than a year into Brazil’s biggest-ever in-court reorganization.
The government plan will include conditions to restructure Oi’s debts to public banks and 11 billion reais ($3.5 billion) or more of fines and interest owed to Anatel, the two sources said, adding that the government sees a regulatory intervention as a last resort.
“Given events in Brasilia, there could be a good plan this week,” said a third person familiar with talks.
The plan put forth by the government group would then be put to a vote at a creditors assembly on Nov. 10. If creditors cannot reach a consensus, the company would be liquidated — an alternative that creditors want to avoid.
$1 = 3.23 reais Reporting by Rodrigo Viga Gaier, Leonardo Goy and Ricardo Brito; Writing by Tatiana Bautzer; Editing by David Gregorio