Oi announces launch of settlement procedures for various bondholders

By Caroline Salls

Pittsburgh, June 15 – Oi SA, Portugal Telecom International Finance BV (PTIF) and Oi Brasil Holdings Coöperatief UA (Oi Coop) launched the settlement procedures for qualified and non-qualified bondholders and PTIF retail bondholders, according to company news releases.

The settlement procedures apply to Oi’s 9¾% senior notes due 2016, 5 1/8% senior notes due 2017, 9½% senior notes due 2019 and 5½% senior notes due 2020, PTIF’s 4 3/8% notes due March 2017, 5.242% notes due November 2017, 5 7/8% notes due 2018, 5% notes due 2019, 4 5/8% notes due 2020 and 4½% notes due 2025 and Oi Coop’s 5 5/8% senior notes due 2021 and 5¾% senior notes due 2022.

The qualified holder settlement procedures also apply to PTIF’s 6¼% notes due 2016.

The deadline for non-qualified holders and qualified holders to participate in the settlement and surrender their notes is 5 p.m. ET on July 12. The deadline for the retail noteholders to participate and surrender their notes is 5 a.m. ET on July 13.

Each non-qualified holder and retail holder that validly participates and surrenders its notes will receive a participation interest in the principal amount of $500 under a non-qualified credit agreement for each $1,000 of bondholder credits held.

Qualified holders that participate and surrender a principal amount of their notes equal to or less than the principal amount of the series of notes that appear on an election list will be eligible to receive new Oi senior notes due 2025, American Depositary Shares (ADS) representing common shares of Oi, ADS representing common shares of Oi currently held by PTIF and American Depositary Warrants.

The credit agreement will be entered into among the issuers, Telemar Norte Leste SA, Oi Móvel SA, Copart 4 Participações SA and Copart 5 Participações SA.

Holders that do not validly participate and surrender their notes will only be entitled to receive a default recovery.

Oi said in a separate news release that the U.S. Bankruptcy Court for the Southern District of New York granted a motion on June 14 for enforcement of a Brazilian Judicial Reorganization Court of the company’s judicial reorganization plan.

The U.S. court order also approves the steps required to complete the plan in connection with Oi’s 9¾% senior notes due 2016, 5 1/8% senior notes due 2017, 9½% senior notes due 2019 and 5½% senior notes due 2020 and Oi Coop’s 5 5/8% senior notes due 2021 and 5¾% senior notes due 2022.

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

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