Oi plans to address Moelis proposal ‘in the normal course’ of case

By Caroline Salls

Pittsburgh, Feb. 23 – Oi SA chief financial officer and investor relations officer Ricardo Malavazi Martins issued a clarification Wednesday in response to a news report titled “Judge orders Oi to take a position on the Moelis proposal in five days.”

According to an Oi news release, the company will make a statement “in the normal course of the judicial reorganization process” about the presentation of an alternative plan presented by Moelis & Co. Oi said its statement will be made in accordance with terms of a Feb. 14 order from the 7th Corporate Court of Rio de Janeiro.

However, the company said it will not take a formal position on the content of the alternative plan, “nor will it represent any decision with respect to any change in the reorganization plan presented by the company.”

Oi said creditor Goldentree Distressed Fund and other creditors belonging to the group of bondholders served by Moelis presented an objection to the company’s plan and have since submitted an alternative plan.

The company said it continues to meet regularly with creditors and other stakeholders with the intention of gathering impressions and comments about the plan, and it believes that the results of these discussions will be reflected in a final proposal of the judicial reorganization plan, to be brought up for approval by a creditors’ meeting.

According to the release, the news report, which was published on the website Globo Online, said the creditors proposed an investment of around R$37 billion in five years to improve operations, efficiency and quality of service.

The report said the debtholders also recommended a swap of R$24.8 billion in debt for a 95% interest in the company, injecting $1.25 billion in new capital and installing a new board of directors. The remaining debt, after the swap, would be substituted for R$5.8 billion in new notes.

Oi is a Rio de Janeiro-based telecommunications service provider. It filed for Chapter 15 bankruptcy in the U.S. Bankruptcy Court for the Southern District of New York on June 21, 2016 under case number 16-11791.

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