June 16, 2020 / 11:46 AM / 2 months ago

Brazil’s Oi amends bankruptcy plan to add sale of mobile unit

SAO PAULO, June 15 (Reuters) - Brazilian telecoms firm Oi SA announced late on Monday a proposed plan that, if approved by creditors, would allow the company to exit a long bankruptcy restructuring process that began in 2016.

Under the plan, Oi hopes to sell its mobile unit for at least 15 billion reais to refocus the company on its fiber network.

Brazil’s largest fixed-line carrier had approximately 65 billion reais ($12.65 billion) of debt when it filed for bankruptcy protection.

After selling some non-core assets, including its 25% stake in Angolan carrier Unitel, to release cash for the expansion of its fiber-to-the-home (FTTH) broadband service, Oi now seeks to amend its bankruptcy plan to add its mobile unit to the list of divestments.

All major rivals have expressed interest in buying Oi’s mobile business.

In March, TIM Participações SA and Telefonica Brasil SA informed Oi’s advisor Bank of America of their interest in kicking off talks for a potential acquisition of all or part of Oi’s mobile division.

Oi’s efforts to file an amendment proposal to its bankruptcy plan led the company to postpone its first-quarter earnings initially scheduled for May 28.

In a separate filing on Monday, the carrier posted a net loss of 6.3 billion reais in the quarter ended on March 31 compared with a net profit of 679 million reais a year before.

Recurring earnings before interest, tax, depreciation and amortization (EBITDA) reached 1.5 billion reais, above a consensus estimate of 1.439 billion reais. Oi’s total debt stood at 24 billion reais, while its cash position stands at 6.3 billion reais.

$1 = 5.1371 reais Reporting by Gabriela Mello, editing by Louise Heavens

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