Brazil's Odebrecht puts Braskem stake as collateral for loans

A sign of the Odebrecht SA construction conglomerate is pictured in Lima, Peru, June 28, 2016. REUTERS/Janine Costa

SAO PAULO (Reuters) - Braskem SA said on Tuesday controlling shareholder Odebrecht Serviços e Participações SA has placed the entire stake it has in the firm as collateral for outstanding bank loans, in a sign of Odebrecht’s challenging debt refinancing outlook.

No details on the accord between Odebrecht Serviços, a subsidiary of Grupo Odebrecht SA [ODBES.UL], and lenders were disclosed in a securities filing by Braskem.

Odebrecht Serviços, a unit of Latin America’s largest engineering group, has voting control of Braskem despite having a 38 percent stake in Latin America’s biggest petrochemical firm.

Grupo Odebrecht is selling assets and renegotiating about 35 billion reais ($10.8 billion) in loans, a little more than a year after being targeted in Brazil’s widest ever corruption probe. Marcelo Odebrecht, the family scion and former chief executive officer of the namesake group, was sentenced to 19 years in jail for his role in the corruption scandal known as “Operation Car Wash.”

The scandal has undercut Grupo Odebrecht’s access to debt financing, and some of the conglomerate’s 15 business units are currently undertaking separate debt renegotiation and restructuring efforts. Reuters reported in March that Grupo Odebrecht was considering exiting Braskem.

State-controlled Petroleo Brasileiro SA, Grupo Odebrecht’s other partner in Braskem with a 36 percent stake, decided to exit the petrochemical firm in January, sources told Reuters at the time. Petrobras, as the state oil firm is known, is also under investigation in the Car Wash probe.

Reporting by Guillermo Parra-Bernal; Editing by Leslie Adler and Bernard Orr