Justice grants Oi protection against creditors – 02/03/2023 – Market

Judge Fernando Cesar Ferreira Viana, from the 7th Business Court of the TJRJ (Court of Justice of the State of Rio de Janeiro), granted Oi protection against the freezing of assets by creditors, in a process that should culminate in the company’s second request for judicial recovery .

The request was made on Wednesday (1), just over a month after the end of the judicial recovery of Telephony, on the grounds that the company is unable to deal with debts of R$ 29 billion.

According to the judge, “the company faces factors such as the instability of economic indicators, unexpected appreciation of the US currency that corrects the obligations assumed, inflationary rise, world crisis resulting from the deleterious effects of the Covid-19 epidemic, delay in closing operations UPI’s sales [ativos]and a short period for negotiating the debt with financial creditors”.

“The risk is strengthened from the moment one envisions the possibility that enforceable measures – including bankruptcy – and the application of contractual penal clauses, such as the early maturity of obligations and also the termination of contracts for the provision of services to public entities and private,” he continues.

The request made by Oi to Justice this Wednesday is similar to the one made by Americanas in January, and aims to anticipate the effects of a judicial recovery. The retailer’s crisis, after the revelation of BRL 20 billion in “countable inconsistencies”, is even cited by Oi as an argument in favor of its own request.

The company asked for protection from the courts due to “imminent risk of irreparable damage”, in order to guarantee the preservation of the company’s activities, according to the text presented by the offices that represent it.

“The measure now pleaded is not new for the Rio de Janeiro judiciary, even more so after the emblematic (and very recent) injunction granted to Grupo Americanas by the MM. “, says Oi in the order.

In the text, the company also recognizes that it has just left the largest judicial recovery process in the history of Brazil, but that, “unfortunately, several unpredictable, uncontrollable factors, and its current economic and financial situation made it essential to resort to judicial protection for implement a new stage of its restructuring and guarantee the preservation of the company, as a great generator of jobs and income”.