Brazil mulls steps to speed
up Oi intervention, papers say
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[November 07, 2016]
SAO
PAULO (Reuters) - The Brazilian government is considering changes to the
country's bankruptcy protection law to facilitate an intervention in Oi
SA, whose in-court reorganization process is suffering with internal
shareholder and creditor disputes, two local newspapers reported on
Monday.
According to daily newspapers Valor Econômico and Folha de S. Paulo,
government officials are considering the possibility of implementing
changes to law via an executive decree. Apart from speeding up an
intervention in Oi, the move would revamp the way the government
oversees carriers, which operate under two types of license, the papers
said.
Folha said President Michel Temer's administration confirmed that
officials are working on a draft decree that would aim at altering some
aspects of the bankruptcy protection law, but that it would only be used
as a "last resort" measure. Usually Congress has 180 days to discuss and
approve an executive decree before expiration.
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According to Folha, which did not say how it obtained the information, a
government intervention in the debt-laden carrier would remove Oi's
current management and board of directors, while keeping a committee of
financial comptrollers. Industry watchdog Anatel would initially
intervene Oi for a year, with the possibility of extending it up to
three, the paper added.
The news comes as speculation mounts that the Temer administration is
concerned about delays and disputes in the Oi plan. Last month, several
government officials acknowledged that an intervention of Oi was
possible, although it did not involve any bailout.
Calls to several press representatives for Rio de Janeiro-based Oi,
which filed for bankruptcy protection in June after talks to restructure
65.4 billion reais ($20 billion) in debt collapsed, for comment were not
immediately answered. The presidential palace did immediately comment on
both stories.
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![](../images/110716pics/busine19.jpg)
The headquarters of the Brazil's largest fixed-line telecoms group
Oi, is pictured in Rio de Janeiro, Brazil, June 22, 2016.
REUTERS/Sergio Moraes
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Asked by Valor whether Oi was aware of the intervention plan, Chief
Executive Officer Marco Schroeder said he acknowledges closer state
monitoring of the situation but said an intervention is "unnecessary."
The restructuring plan that Oi presented to creditors on Sept. 5 failed
to garner support from key state creditors and Anatel, which altogether
are owed almost 30 billion reais by the company, Folha said, without
citing sources for the information.
(Reporting by Guillermo Parra-Bernal and Bruno Federowski, editing by
Louise Heavens)
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