Eike fires OGX president and could be next.
Shares of the oil company saw their biggest increase today since their stock market debut: 48%, returning to a value of R$ 1,1 billion; the surge occurred after the Infomoney portal reported that OGX creditors are considering a proposal to convert debt into shares, giving them a stake in the company and diluting the participation of controlling shareholder Eike Batista; the businessman dismissed CEO Luiz Carneiro today; according to a Folha report, the new investors insist on a change in executives.
SÃO PAULO - After a trading session marked by auctions, OGX Petróleo (OGXP3) shares closed with a 47,83% increase, at R$ 0,34 - the day's high. The shares showed strong volume, moving around R$ 138,20 million, well above the average of the last five days, at R$ 21 million. With this, the company's market value reached R$ 1,1 billion again.
Shares of the oil company are fluctuating amid rumors of Eike Batista's meeting with creditors in New York. After a gradual improvement in tone, the company may be close to the necessary debt restructuring – essential for its future and to avoid potential bankruptcy or insolvency.
According to InfoMoney, a source close to the company highlighted that this restructuring could involve the total forgiveness of the company's debt – in a transaction that would transform the debt securities held by these investors into new company shares. This would dilute Eike's position, leading him to abandon the oil company altogether.
According to the source, this operation may involve the participation of BNDES (National Bank for Economic and Social Development), which would finance the restructuring process, as well as provide the cash for the company to survive until effective production begins at Tubarão Martelo. In recent days, Guido Mantega, Minister of Finance, and Luciano Coutinho have denied any operation of this kind.
To satisfy investors who would invest in the company again, Eike fired the company's CEO, Luiz Carneiro, and the legal director, José Roberto Faveret, reported Folha de S. Paulo. The newspaper states that the new investors insist on the replacement of the executives.
According to other sources at Folha, Carneiro is being fired for partially exercising his "put" option, requesting US$100 million from the company, which Eike refuses to do. Carneiro's relationship with Ricardo Knoepfelmacher of Angra Partners, who has been leading the restructuring process, was also supposedly strained.
News originally published in InfoMoney.