Yatch_29_06_17

From City Am

Luxury yacht maker Sunseeker sets sail for future growth after swinging back to profit in a “remarkable turnaround”.

The figures

Britain’s biggest boat builder reported earnings before interest, tax, depreciation and amortisation (Ebitda) of £6m for the year to the end of December, compared with a loss of £7m the previous year.

Sunseeker said its forward order book increased 41 per cent by volume year-on-year, and revenue increased 25 per cent to £252.4m from £202.6m in 2015.

The group will invest a further £50m across the business to support a bold product plan with many more new introductions over the next few years.

Why it’s interesting

Chief executive Phil Popham, who joined the company in 2015 from Jaguar Land Rover, said new and exciting products are what breed growth in the boating market.

“The response we have had for our latest models has been nothing short of incredible.” The iconic group brought out five new models across a size range of 50 to 155 feet long in 2016.

Demand for the company’s larger models has grown year-on-year with more than 100 yachts over 100 feet in length already delivered.

Popham’s turnaround programme, which has swung Sunseeker back into profit after years of losses, included a “significant” restructuring and refocusing of the business along with substantial investment across new products.

“It has been a remarkable turnaround in such a short space of time and much of this can be attributed to our strategy to continually invest across the key areas of the business, especially our products,” Popham said.

What Sunseeker said

Popham said:

“2016 has been a defining year for Sunseeker and I’d like to personally thank the whole Sunseeker team for their hard work and dedication and our shareholder Wanda Group for their continued support to help make this possible. The business is on a fresh course, not just to strengthen our position as Britain’s largest boat builder, but as the global leader for luxury performance superyachts. All this, underpinned by a strong forward order book, means we are extremely excited about the future.”

 

Puerto_Rico_29_06_17

From Bloomberg

For Puerto Rico, it’s been expensive to go broke.

Even before the U.S. territory filed for a tailor-made form of bankruptcy, the government spent as much as $154 million on financial consultants and lawyers as it negotiated with bondholders to cut its $74 billion debt, according to the terms in contracts provided by the island’s Office of the Comptroller. With creditors and Puerto Rico now squaring off in court, the fees will only grow.

“This can become very expensive in relationship to the benefits you receive if you don’t get to a recovery and bring people along quickly,” said James Spiotto, managing director at Chicago-based Chapman Strategic Advisors LLC, whose firm advises on municipal restructurings. “Dealing with financial distress is expensive.”

Puerto Rico’s May 3 bankruptcy, allowed under a unique process created by a federal rescue law enacted last year, is the largest ever for a U.S. government, promising significant paydays for lawyers and advisers clashing over who has a higher claim on the island’s diminished cash. The amount the government spent during its slow-motion collapse approached the $180 million shelled out in Detroit’s record bankruptcy — roughly equivalent to what it costs to cover the annual pensions of 11,000 Puerto Rico retirees.

Some of the spending on consultants has borne fruit: the Puerto Rico Electric Power Authority, known as Prepa, and the Government Development Bank have both reached out-of-court settlements with bondholders to reduce what’s owed. The power company’s deal struck this year, which amended an earlier one, promises to cut its debt-service costs by about $2.2 billion from 2018 to 2022 if it’s executed. Puerto Rico was less successful with owners of other bonds, ultimately wagering on a better outcome from bankruptcy.

The amount Puerto Rico has spent on outside consultants is based on the maximums specified in the contracts. The actual amounts may differ, depending on the work performed. Following are the sums included in the agreements and the firms involved:

  • $52.7 million: Cleary Gottlieb Steen & Hamilton LLP, which advised the commonwealth and the electric company on restructuring from February 2014 until January 2017 and negotiated with creditors
  • $45.6 million: AlixPartners LLP, whose managing director, Lisa Donahue, served as chief restructuring officer of the power company from September 2014 until February 2017
  • $26.5 million: Millco Advisors LP, an affiliate of Washington-based Millstein & Co., had advised former Puerto Rico Governor Alejandro Garcia Padilla since 2014 on Prepa’s restructuring and the ultimately unsuccessful efforts to reduce the government’s general debt
  • $7.5 million: Kirkland & Ellis LLP, which represented the commonwealth in legal disputes including challenges to the island’s debt-moratorium law
  • $6.6 million: Proskauer Rose LLP, adviser to the Government Development Bank
  • $6.4 million: Rothschild & Co., which Governor Ricardo Rossello hired to replace Millco, based on the contract running through this month. Puerto Rico’s Fiscal Agency and Financing Advisory Authority has paid Rothschild $3.6 million, as of June 10, according to the agency.
  • $6 million: Dentons LLP, which Rossello hired to replace Cleary Gottlieb, with a contract that runs through June 2017. Dentons has subcontracted legal work from O’Melveny & Myers LLP, according to Puerto Rico’s fiscal agency.
  • $2.2 million: O’Neill & Borges LLC, adviser to the development bank
  • The conflict over Puerto Rico’s series of defaults is now playing out in U.S. court in San Juan, where the island is seeking to have billions of dollars of debt written off. Its fiscal turnaround plan, approved by federal overseers in March, would cover less than a quarter of the $33.4 billion the commonwealth and its agencies owe in debt payments through fiscal 2026. Creditors have questioned the magnitude of the cuts they’re facing.It’s unclear how long the workout will linger in court. Detroit, with $8 billion of bond debt, took 17 months to emerge from bankruptcy. Jefferson County, Alabama’s, the second-biggest bankruptcy case, took about two years.

    While the process will ultimately steady the government’s finances and likely save it billions of dollars, it won’t be cheap. Puerto Rico will also need to cover the legal fees for some creditors, which will add to the commonwealth’s bankruptcy costs.

    McKinsey & Co. was hired as a strategic consultant to the federal oversight board, whose bills are covered by Puerto Rico, under a $3.75 million contract. Proskauer, the lead legal counsel in the island’s bankruptcy, was also hired by the board, as was O’Neill & Borges. Edward Zayas, spokesman for the panel, said it would disclose “soon” how much the board is paying the firms.

    Spokespeople for Cleary Gottlieb, AlixPartners, McKinsey and Kirkland & Ellis declined to comment. Representatives of Rothschild, Dentons, O’Neill & Borges, Millstein, Proskauer, O’Melveny. Puerto Rico’s fiscal agency said in a statement that it isn’t responsible for contracts entered into before April 2016, when it was created.

Sears_29_06_17

From CNN

Sears Canada filed for bankruptcy early Thursday, making it the latest casualty of the crisis among traditional brick-and-mortar retailers. It’s also another sign of trouble for the iconic retailer.

Sears Canada, which has more than 200 stores and about 17,000 employees, was spun-off as an independent company in 2012. But the filing is still bad news for Sears Holdings (SHLD), which owns both the Sears and Kmart brands in the United States. Sears Holdings still owns 12% of its shares.

Sears Holdings CEO and principal shareholder Eddie Lampert, who has been struggling to keep the company afloat amid its own mounting losses, owns a total of 45% of Sears Canada both personally and through his hedge fund.

The bankruptcy filing was not a surprise. Sears Canada said a week ago that it was in danger of running out of the cash it needed to fund operations. Thursday’s filing said that it expects to remain in business.

Related: Retail bloodbath – Bankruptcy filings are up

Sears Canada said that recent changes to its stores are starting to resonate with consumers, but it had to file for bankruptcy to give it the time it needed to let those changes take hold. In the last quarter alone, Sears Canada burned through about 30% of its cash and maxed out its existing credit lines. It said it had planned to borrow 175 million Canadian dollars to fund operations, but after negotiations with lenders it found it could only secure only C$109 million in additional loans.

Sears Canada said it hoped to be able to restructure and emerge from bankruptcy later this year. It did not give any details about store closing plans or staff cuts it might make as part of its restructuring.

In March, Sears Holdings also issued a warning about there being “substantial doubt” it could stay in business. But that warning, as serious as it was, did not paint the dire picture of a company running out of cash in the near term as did Sears Canada’s warning last week.

Sears and Sears Canada are hardly the only struggling retailers. In the United States, retail bankruptcies are up about 30% so far this year, according to BankruptcyData.com. Well known names including RadioShack, Gymboree, Sports Authority and Payless Shoes have all filed for bankruptcy within the last year. Total store closings across the U.S. are likely to reach record levels this year.

By some estimates, 25% of U.S. malls could close within the next five years. Department stores have shed 46% of their workers since 2001, a greater percentage of their jobs than coal mines or factories have lost over the same period.

Lender_29_06_17

From Linkedin

By Michael L. Moskowitz and Melissa A. Guseynov

In a recent decision of consequence to mortgage lenders, the United States Bankruptcy Court for the District of Massachusetts concluded that a Chapter 7 Trustee may avoid a debtor’s mortgage and maintain it for the benefit of the bankruptcy estate. See Eastern Bank v. Benton (In re Thomas H. and Nancy C. Benton), 2016 WL 53581 (Bankr. D. Mass. Jan. 4, 2017). Simply put, the Bankruptcy Court held that, when a mortgage contains a correct street address but an incorrect legal description, the mortgage lien is avoidable by the bankruptcy trustee in his or her role as a hypothetical bona fide purchaser of a debtor’s property under section 544 of the Bankruptcy Code.

In Eastern Bank, prior to filing their bankruptcy petition, debtors granted a mortgage to Eastern Bank (“Eastern”), which was secured by their residence. However, debtors also owned another property in a neighboring town. As a result of Eastern’s clerical errors, the recorded mortgage listed the street address of debtors’ residence, but included a legal description for their second property. After the error was discovered, Eastern commenced an adversary proceeding seeking to reform the mortgage. In response, the Trustee filed a cross-complaint seeking avoidance of the mortgage pursuant to section 544(a)(3) of the Bankruptcy Code.

The Bankruptcy Court granted summary judgment in favor of the Trustee, thus permitting the Trustee to avoid Eastern’s mortgage. In reaching its decision, the Court reviewed several prior cases but ultimately relied on Bank of N.Y. v. Sheeley, 2014 WL 1233094 (S.D. Ohio March 25, 2014), which held that a “street address on the mortgage, when it conflicts with a more specific legal description incorporated by reference in the mortgage, fails to provide constructive notice to a bona fide purchaser of the encumbrance.”

The decision in Eastern Bank underscores how important it is for mortgage lenders to make certain a street address referenced in a mortgage matches the legal description. Attention to detail is critical.

Weltman & Moskowitz will continue to follow these cases and report on any pertinent developments. We welcome any inquiries you may have and recommend you reach out to us at (212) 684-7800, (201) 794-7500 or email Michael Moskowitz to discuss any bankruptcy or foreclosure challenges you may be facing.

Click here to read our other blog articles.

About Weltman & Moskowitz, LLP, A New York and New Jersey Business, Bankruptcy, and Creditors’ Rights Law Firm:

Founded in 1987, Weltman & Moskowitz, LLP is a highly regarded business law firm concentrating on creditors’ rights, bankruptcy, foreclosure, and business litigation. Michael L. Moskowitz, a partner with the firm, focuses his practice on business and bankruptcy litigation, as well as creditor’s rights, foreclosure, adversary proceeding litigation, corporate counseling, M&A, and transactional matters. Michael can be reached at (212) 684-7800, (201) 794-7500 or mlm@weltmosk.com. Melissa Guseynov is an associate of the firm. Melissa can be reached at mag@weltmosk.com.

Takata_29_06_17

From CDN

Takata tktdy will seek bankruptcy protection from creditors on Monday, two sources said, as the Japanese company faces billions of dollars in liabilities stemming from the biggest recall in automotive history.

The firm, whose defective air-bag inflators have been blamed for at least 16 deaths and more than 150 injuries worldwide, will file for protection in Tokyo District Court under the Civil Rehabilitation Act, Japan’s version of U.S. Chapter 11 bankruptcy, said the sources, one of whom has direct knowledge of the matter and one who was briefed on the process.

Takata will then seek bridge loans from the core banking unit of Sumitomo Mitsui Financial Group, which will provide tens of billions of yen (hundreds of millions of dollars) in bridge loans, one source said.

Takata spokesman Toyohiro Hishikawa said nothing had been decided regarding any filing or financing.

Shares in Takata changed hands for the first time since sources said last week that the struggling airbag maker was preparing to file for bankruptcy.

By mid-afternoon shares had more than halved in value to 116 yen, eroding Takata’s market capitalisation by about 75% from a week ago to nearly $86 million now.

Any filing would coincide with a deal for financial backing from U.S. auto parts maker Key Safety Systems. Key is expected to acquire Takata assets as part of a restructuring in bankruptcy, a source told Reuters.

Takata would stop making air-bag inflators after completing a global recall as part of the restructuring plan with Key, separate sources said.

Takata plans to begin bankruptcy proceedings in both the United States and Japan, sources have said. Such moves would culminate a long, tumultuous fall for the family-controlled company that grew to become a global supplier to most of the world’s major automakers.

Mozambique_29_06_17

From Bloomberg

Mozambique’s smaller banks should combine in an effort to overcome the blow dealt by government debt defaults after four lenders failed over nine months.

The country’s debt crisis threatens to unravel efforts by the central bank to strengthen the nation’s financial system through the introduction of new capital and liquidity rules. Central bank Governor Rogerio Zandamela said last week the measures might result in consolidation or force companies to change their operating models. The central bank didn’t respond to email questions sent last week.

“Mozambique’s banking sector faces a serious systemic risk of collapse,” said Robert Besseling, Johannesburg-based director at Exx Africa, which advises companies on business risks. “Rapid credit growth and concentration of bank loan books are the main risks,” while some of the country’s lenders bought significant amounts of loans now in default.

The economy of the world’s ninth-poorest nation is in turmoil after state-owned companies piled on more debt than the government, which guaranteed the loans, is able to repay. The loans hadn’t been disclosed, resulting in the International Monetary Fund and other donors withdrawing aid. A Kroll LLC probe found the companies

The central bank has already had to contend with four failures over a nine-month period. Moza Banco SA, O Nosso Banco SA, Microbanco Fides Mocambique SA and Caixa Cooperativa De Credito SA had to be taken over by regulators or cease operations, while Atlas Mara Ltd.’s BancABC Mozambique needed a cash injection from shareholders.

With 19 commercial banks, nine smaller lenders and 69 micro-credit organizations for a population of about 27 million, Mozambique has more banks per person than the continent’s two biggest economies of South Africa and Nigeria.

“The central bank is trying to correct things in the banking system,” said Fernanda Massarongo, a researcher at the Economics and Development Research Group in Maputo. It still needs to confront a sharp decline in the rate of credit growth, falling property prices and the potential manipulation of solvency ratios by banks to make themselves seem stable, she said.

Regulators insist the financial system is stable. While big lenders have an excess of liquidity, the smaller banks have too little, Zandamela said on June 19, adding that those lacking capital aren’t a systemic risk.

couldn’t account for at least $500 million of the $2 billion in loans, most of which were arranged by Credit Suisse Group AG.

Mozambique lenders do have some buffers that might help the banking system even though the government’s debt obligations may exceed the country’s gross domestic product, according to analysts at BMI Research.

Almost 40 percent of the deposits they hold can’t be withdrawn without notice, reducing the scope for bank runs, BMI analysts said in a June 15 report. Furthermore, lenders are mostly domestic-deposit funded, while the high level of foreign ownership means there’s a source of funding should the industry run into difficulties, according to BMI.

The 19 registered commercial banks in Mozambique are mostly units of foreign lenders or controlled by international investors. Socremo Banco de Microfinancas SA, Moza Banco SA and Banco Nacional de Investimento SA are the lenders majority owned by Mozambican shareholders, according to their records.

Barclays Africa Group Ltd. wanted to consolidate its Mozambican assets by bidding for Moza Banco, people familiar with the matter said in May, but the central bank chose to give the failed lender to the regulator’s own pension fund.

Mozambican banks, already under stress due to a shortage of dollars, will likely see credit-risks rise this year because of an increase in bad debts and investments by banks in the government-linked loans, Besseling said. There are also limited prospects that the IMF will entertain a new program or that donors will end their yearlong freeze on direct budget support, he said.

Moza Banco bought $20 million of the ProIndicus loan from Credit Suisse and Millenium BIM also lent that state-owned company money, according to the Kroll report. Both Moza Banco and Banco Comercial e de Investimentos SARL had accounts for ProIndicus and Moza Banco also handled state-owned Ematum’s account, it said. The IMF is planning a visit to Mozambique from July 10 to discuss the results of Kroll’s audit.

“Even if some banks intend to hold out against market consolidation forces, the government is likely to require some to merge or open up for acquisition by imposing very strict liquidity limits and other regulations,” Besseling said. “The Moza Banco episode shows that some stakeholders in Mozambique would prefer to allow local political interests to benefit from the consolidation process, rather than to open up to foreign investors.”

Italy_29_06_17

From AMP

taly began winding up two failed regional banks on Sunday in a deal that could cost the state up to 17 billion euros ($19 billion) and will leave the lenders’ good assets in the hands of the nation’s biggest retail bank, Intesa Sanpaolo.

The government will pay 5.2 billion euros to Intesa, and give it guarantees of up 12 billion euros, so that it will take over the remains of Popolare di Vicenza and Veneto Banca, which collapsed after years of mismanagement and poor lending.

Minimize_28_06_17_POSTADO_07_07_17

From IndustryWeek

Anyone who has been in private business long enough has likely observed a key vendor or customer suffer some form of financial distress or, even worse, file for bankruptcy.

Upon learning that a key customer is on shaky financial ground, while perhaps sympathetic to their customer’s situation, many businesses respond by taking ad hoc actions that are intended to limit the short-term damage to their own enterprises. For instance, a business might force the customer to remit payments via wire transfers or begin implementing collection practices to which other customers are not subject or that significantly deviate from standard industry practices.

But when businesses do this, they are unwittingly putting themselves in the way of potential financial liabilities should the customer ultimately declare bankruptcy, not to mention a burdensome amount of work detangling your company from theirs. We’d like to think the extent of our exposure to a bankrupt customer is a handful of unpaid invoices.  But in reality it could be worse – and often is.

For instance, once the sting of getting stuck with a few unpaid invoices begins to fade, you will probably receive, 12 or even 18 months later, a letter demanding that you disgorge all payments received from your former customer in the 90 days before its bankruptcy petition date — return to the company the payments received for products or services provided. These so-called preferential transfer claims are rooted in Chapter 5 of the U.S. Bankruptcy Code, which sets forth how courts are to consider prepetition transfers of a debtor’s assets, such as when they pay an unsecured supplier’s bill.

The intent of the law is to take back monies that were paid to the “preferred” vendor and equally redistribute those monies to all creditors.  While the fairness of this is debatable, the harsh reality is that the Code creates significant liability for enterprises that are engaged in commerce with distressed companies — something manufacturers and suppliers need to be especially mindful of given the number of recent and anticipated bankruptcies in the retail industry.

Once a creditor receives the demand letter — or becomes party to a lawsuit — the die is cast, and there is very little that can be done. The set of facts brought before the judge will be comprised of processes and actions undertaken well before the debtor filed for bankruptcy, and a creditor’s eventual liability hangs on those facts. That’s why it is so important to plan ahead and put into place sound business practices that can minimize exposure to bankruptcy preference claims well before a key customer declares itself bankrupt.  So what should be done?

Keep a Close Eye on Your Customers’ Health

Ideally, it should never be a surprise when a key customer or supplier declares bankruptcy.

The reality, of course, is that surprises do occur. For instance, last year, the entire North American production line for one automotive manufacturer was threatened with a potential shutdown when the automaker’s only supplier of acoustic damping materials went bankrupt and halted its operations in a move that took the automaker by surprise.

It is no less damaging when a manufacturer’s key retailing customer enters bankruptcy. When a large shoe retailer declared bankruptcy in April, it owed its trade creditors some $240 million. These creditors no doubt learned the importance of monitoring their customers’ financial health, although for some the opportunity to learn the lesson came too late.

Keeping a close eye on the financial health of the customer is always a manufacturer’s first line of defense. Publicly reported information and news outlets can be helpful in this regard.  If you have the luxury of a supply contract you can include terms that require the customer to provide you with periodic financial information.  But even without this detail sometimes the reddest of red flags can be found within the data that suppliers have right at their fingertips.

For example, each existing customer relationship will have an established baseline of days-sales-outstanding (DSO).  Manufacturers and suppliers should invest in resources that automate the analysis of DSO information so they can have real-time comparisons of every customer’s 12-month moving DSO average versus that of current payments. If there is a substantial deviation away from the 12-month moving average — especially when the deviation is coupled with other indications of financial distress — then this should be a big red flag for potential preference exposure once the customer files for bankruptcy.

Be Consistent in Dealing with Customers

Ascertaining the true financial health of customers, however, is only half of the solution to limiting exposure to bankruptcy preference claims.

In these instances, one of the most powerful ideas at a creditor’s disposal is the so-called “ordinary course of business” defense which, ideally, shields a creditor from much of the preference analysis that courts undertake and that could potentially increase an individual creditor’s liability. In order to credibly assert this defense, however, there has to be an underlying pattern of commercial behavior that defines what is “ordinary.” Establishing consistency in one’s dealings with customers is of paramount importance in the bankruptcy setting.  For example, one can demonstrate consistency by showing that the DSO for the invoices paid during the 90-day period before bankruptcy was very close to the 12-month DSO average.

Consistency doesn’t just apply to specific dealings with a troubled customer.  There also needs to be an enterprisewide effort to establish and apply uniform procedures for dealing with past due invoices and credit limits. This across-the-board consistency is critical because, when any particular customer shows signs of weakness, the methods used for addressing the situation will then come to be seen as standard operating procedure rather than the desperate one-off attempt to “opt out” of a relationship with a financially distressed customer.

It is also important that each customer’s payment terms are consistent with the industry at large.  If payment terms are relatively extreme — i.e., very low or very high for your industry — they can jeopardize a manufacturer’s ability to assert the “ordinary course of business” defense against clawback actions. Of course, excellent, consistently applied credit practices cannot solve every issue, but they can significantly reduce a manufacturer’s or supplier’s exposure to bankruptcy avoidance actions.

Odebrecht_12_06_17

From Reuters

Odebrecht Óleo & Gás SA, the offshore oil drilling firm owned by Brazil’s Odebrecht SA, reached an agreement with more than 60 percent of its creditors for a restructuring of about $5 billion in debt, it said in a statement on Tuesday.

OOG, as the company is known, had told Reuters earlier this month that talks with creditors were in final stages. OOG is among Odebrecht SA subsidiaries struggling with a widespread slowdown in Latin America and restricted access to credit in the wake of a huge corruption scandal.

Buildings stand next to Ipanema Beach in this aerial photograph taken above Rio de Janeiro, Brazil on Friday, June 17, 2016. Brazil's federal government has agreed to provide emergency funding to Rio de Janeiro state after the host of this year's summer Olympics declared an emergency as it runs short of cash weeks before the start of the games. Photographer: Dado Galdieri/Bloomberg

From Bloomberg

Brasil Distressed, the troubled-asset buyer also known as BrD, shuffled its partnership and said it plans to step up purchases this year.

BrD aims to invest in as much as 1.5 billion reais ($460 million) in soured debt from mid-size Brazilian companies, two-thirds more than it bought last year, Carlos Catraio, a managing partner, said in an interview. The firm has purchased about 3 billion reais in debt since it was created in 2010.

In addition, BrD named Marcio Fujita a managing partner to replace Jose Guilherme Lembi de Faria, who’s left the company, according to Catraio. Fujita and Catraio together own 68 percent of BrD. The remaining 32 percent was sold to Araba Comercio de Bens e Participacoes Ltda., controlled by Portugal’s Lapa family.

Small and medium-size companies are among the most damaged by Brazil’s two-year recession, with roughly 14 percent of their loans delinquent or already restructured, according to central bank data from December, the most recent available. That’s up from about 11 percent a year earlier. Data from Serasa Experian shows that 94 mid-size companies asked for court protection from creditors this year through April, down from an all-time high of 149 in the same period of 2016.

Credit Recovery

“The crisis generates potential raw material, but it also increases the difficulty of credit recovery because fewer companies are able to survive,” Catraio said. More firms have been repaying debts in the past few months as Brazil’s economy shows signs of recovery from the downturn, the worst in the nation’s history, he said.

That’s why BrD gave up on some sectors, including companies that provide heavy machinery to the construction industry, according to Catraio.

“In this environment, like the rest of the credit market we became more cautious,” said Fujita, who was named a managing partner in February, according to his LinkedIn page.

BrD’s purchases are typically in the range of 1 million reais to 30 million reais, and the company doesn’t buy retail portfolios or legal claims, Catraio said. “We have also been buying offshore debt from Brazilian debtors,” he said.

Distressed asset investors have been flocking to Brazil. Lone Star Funds, founded by billionaire John Grayken, is buying Apoema Capital Partners, a Brazilian firm that manages about 4.5 billion reais in distressed assets, a person with knowledge of the matter said in April. Canvas Capital SA, backed by Credit Suisse Group AG, is raising a fund of as much as $600 million to invest in distressed corporate assets in Brazil, people said in March.

“We might consider joining forces with an international distressed player,” said Catraio, adding that no such talks are under way yet.