What happens if Americanas do not get along with creditors – 02/16/2023 – Market

In order for its judicial reorganization plan to be presented to Justice on March 20, Americanas needs to reach an agreement with the major creditors, who are extremely dissatisfied with the “palliative” solutions that the trio of billionaires Jorge Paulo Lemann, Marcel Telles and Beto Sicupira, the retailer’s main shareholders, have presented.

One of them is debtor-in-possesion financing (DIP financing), approved by the Justice on the 9th, in the amount of up to R$ 2 billion. This Thursday (16), the trio’s proposal to inject BRL 7 billion, already discounting the contribution of BRL 1 billion made last week, was also considered irrelevant, in view of Americanas’ debts, in the order of BRL 43 billion.

“It is noteworthy that the DIP of Americanas does not present guarantees, an issue of debentures was made”, says lawyer specialist in judicial recovery Filipe Denki, from Lara Martins Advogados. “In bankruptcy, the main shareholders become creditors and receive before any other creditors.’

If there is no prior agreement with the creditors, Americanas may present the judicial reorganization plan in its own way to the Justice. Experts say the first version of the plan is often considered a “piece of fiction” made only to comply with the law. In general, these proposals have the same parameters, such as an 80% discount on debts and a period of 15 years to pay.

But creditors will have up to 30 days to file objections to the plan. If there is one or more objections, a general meeting of creditors will be convened, which will vote to approve, reject or modify the plan.

“In case of rejection, the trustee asks the creditors if they want to present an alternative plan. If they refuse, it is converted into bankruptcy”, says Filipe Denki.

If they opt for an alternative plan, the proposal will have 30 days to be presented and then put to a vote at the general meeting of creditors.

“In case of approval, judicial recovery follows. If it is rejected, however, by the majority of creditors, bankruptcy also occurs”, says Denki, who considers “unlikely” the willingness of creditors to present an alternative plan.

“In general, to present a judicial recovery plan, it is necessary to have access to many details of the company’s operation, something that the creditors do not have”, says Denki.

Search for people interested in ‘buying liabilities’

That is, without an agreement, the only option left for the retailer is to close its doors – a solution that is not good for anyone, including financial institutions.

Hence the relevance of this negotiation stage between creditors and retailer.

Americanas’ biggest debt is in the hands of private banks. Debts with financial institutions amount to R$19.5 billion, with Bradesco the largest creditor (R$5.1 billion), followed by Santander (R$3.6 billion), BTG (R$3.5 billion) , Itaú Unibanco (R$2.7 billion) and Safra (R$2.5 billion). Public banks Banco do Brasil (R$ 1.6 billion) and Caixa (R$ 500 million) are also on the list.

It is during this interval between the granting of the request for judicial recovery and the presentation of the first version of the payment plan that creditors show shareholders what they expect them to do, says lawyer Fernando Bilotti, partner at Santos Neto Advogados.

“The majority have a lot of money. This does not mean that they have to pay all the losses”, says Bilotti. “But it’s very difficult to leave a huge loss to creditors alone.” The negotiation that took place this Thursday, in his assessment, should be just the first of many.

As with the recovery plan, these attempts at compromise often have a lot of back and forth.

Banks such as BTG, Safra and Votorantim have already gone to court to try to execute payments that, in the understanding of their defenses, should not be affected by the request for judicial recovery. In this sense, Americanas cannot rule out the possibility that many of these creditors will, in fact, manage to offset these credits outside the recovery process.

“These are negotiations first to try to pacify creditors, try to impede these movements and already talk about ways to fulfill these credits”, says lawyer Daniel Báril, from the insolvency and restructuring area of ​​Silveiro Advogados.

In his assessment, Americanas is not necessarily negotiating the liability at this time, but how much will be injected into the business. It is possible that, from now on, the retailer will also start to bring interested parties in buying the liabilities to the negotiation, something common in judicial recovery processes.