Odebrecht shipyard files for bankruptcy protection.

247 - The Enseada Paraguaçu shipyard, whose main partner is Odebrecht, requested on Friday night that the Rio de Janeiro court approve an extrajudicial reorganization plan for the company. Approximately 60% of creditors have agreed to the plan, and the total debt included in the process is around R$ 750 million. It is estimated that the shipyard still has debts of R$ 2 billion with banks.

The information is from Report by Josette Goulart in the State of São Paulo.

"This is the first time an Odebrecht group company has resorted to the courts to have a recovery plan approved. However, extrajudicial recovery differs from judicial recovery, as the negotiation of the restructuring conditions depends solely on the creditors. The plan to be approved by the court foresees that the debt will be paid off over 19 years."

According to the initial petition filed with the court, which the newspaper Estado had access to, the proposal was approved by 64% of the creditors of the Bahia business unit. The company also has a unit in Rio de Janeiro.

Enseada's strategy was to negotiate debts separately to have sufficient quorum to approve an out-of-court plan and avoid judicial reorganization. The company's request to the court also includes the suspension of all debt enforcement or bankruptcy petitions. However, even if approved, creditors who did not adhere to the plan can appeal the decision.

The Enseada Paraguaçu was built to fulfill contracts signed with Sete Brasil, which in 2011 ordered six drilling rigs from the company. The company's 2015 balance sheet already showed signs of difficulty. There were short-term liabilities of R$ 2 billion without any coverage from new revenue. Sete Brasil failed to pay the shipyard R$ 1,4 billion for contracts for ships that were already under construction.