Oi Board approves new judicial recovery plan

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At the end of the process, according to the proposal, current Oi shareholders will have 20% of the company’s capital. Oi’s administrative headquarters is located in Leblon, South Zone of Rio Marcos Serra Lima/G1 Oi announced this Tuesday (6) that its board of directors approved the revised terms and conditions and the new version of the judicial recovery plan, with forecast of raising a loan in reais equivalent to US$650 million, in addition to selling shares in companies such as V.tal, a fiber optic company. “The company continues in intense negotiations, with financial creditors and other unsecured creditors, regarding the specific terms and conditions of a potential binding agreement to support the new version of the judicial recovery plan”, said Oi in a relevant fact. “Therefore, the new version of the judicial recovery plan is still subject to negotiations with creditors, in case the conditions for an agreement to support the plan are met,” stated the company. The proposal approved by the board includes: a discount of up to 45% on debt held by creditors who own telephone towers used by the company, 60% on debt held by satellite operators and a reverse auction providing for a minimum discount of 90%. At the end of the process, according to the proposal, current Oi shareholders will have 20% of the company’s capital. The company was once seen as a “national champion” during the first term of President Luiz Inácio Lula da Silva (PT), but succumbed to a first judicial recovery in 2016, when it was forced to sell assets that included its mobile phone network to rivals Telefônica Brasil, TIM and Claro. Oi is currently in its second protection process against creditors. Oi disclosed in the document an estimate that its fiber optic operation, its main business currently, ended 2023 with negative earnings before interest, taxes, depreciation and amortization (EBITDA) of around R$1.3 billion, which is expected to be, according to the company, a positive result of R$ 125 million in 2028. The company projects to go from a base of 4 million homes connected with fiber optics in 2023 to 5.6 million in 2028, with fiber revenue increasing from R$ 4.42 billion to R$6.4 billion in the same period. In consolidated terms, the company predicted that “Nova Oi” will go from net revenue of R$9.6 billion in 2023 to revenue of R$9.3 billion in 2028, with the “reported” Ebitda going from negative R $409 million to R$1.4 billion positive in the same interval. According to Oi, the increase in Ebitda will occur “through greater scale of the fiber business, gradual elimination of legacy and efficiency initiatives, in addition to the impact of cost reduction initiatives in all business units”. The numbers, however, do not consider the sale of strategic assets such as ClientCo (Oi Fibra) and V.tal. Number of companies in judicial recovery increases in the country

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