(Adds statement from communications minister, share price)
SAO PAULO Oct 11 A group of bondholders in Oi
SA has teamed up with Egyptian billionaire Naguib
Sawiris to shore up Brazil's biggest fixed-line phone operator,
which is currently under creditor protection.
The creditors, who are represented by Moelis & Co, said in a
statement on Tuesday they will join forces with Sawiris "to
discuss and evaluate an alternative recovery plan for Oi" during
and after it emerges from bankruptcy.
Their decision to cooperate comes after a series of
shareholder disputes and protracted negotiations have delayed
discussions about Oi's recovery plan, which was presented on
Sept. 5. Sawiris had been linked with a potential takeover of Oi
since last year. The latest speculation came in June, days
before Oi filed for bankruptcy protection.
In June, the Rio de Janeiro-based carrier filed for Brazil's
largest bankruptcy in history to restructure 65.4 billion reais
($20.3 billion) of loans.
The Moelis-led group lashed out at Oi's reorganization plan,
calling it "unacceptable" the same week it was filed in a Rio de
Janeiro bankruptcy court. On Tuesday, Communications Minister
Gilberto Kassab said the government, while trying not to
intervene in Oi's reorganization, is working to avoid a seizure
or a state bailout of the carrier.
Preferred shares in Oi rose 0.4 percent to 2.88 reais.
The byproduct of a government-sponsored merger at the end of
last decade, Oi succumbed to a heavy debt burden, mounting
competition and years of shareholder disputes. After the
bondholders, state entities including banks and industry
regulator Anatel make up the largest Oi creditor group with
about 20 billion reais of debt.
Bondholders frowned at the company's Sept. 5 plan because it
implied a 70 percent reduction on their debt holdings. With 34
billion of bond debt outstanding, these investors form Oi's
largest creditor group.
($1 = 3.2210 reais)
(Reporting by Ana Mano; Additional reporting by Leonardo Goy in
Brasilia and Brad Haynes in São Paulo; Editing by Guillermo
Parra-Bernal and Lisa Shumaker)