Batista's OGX unveils terms of updated restructuring plan
By Guillermo Parra-Bernal
SAO PAULO May 26 (Reuters) - Brazilian bankrupt oil firm Óleo e Gás Participações SA unveiled new rules under its restructuring plan for the remaining portion of a debtor-in-possession loan and a put option that would require controlling shareholder Eike Batista to inject $1 billion into the company.
In a document released over the weekend, the Rio de Janeiro-based company, formerly known as OGX Petróleo e Gás Participações SA, said creditors would have to approve an additional $90 million from a so-called DIP, debtor-in-possesion, loan in two portions.
It also included a clause informing creditors of a potential sale of Oléo e Gas's Colombia unit and changes to the so-called "Eike-put" option from the original plan released in February.
Oléo e Gás filed Latin America's largest-ever bankruptcy-protection petition in Rio de Janiero on Oct. 30 after its first oil wells produced less than expected and investors lost confidence in the company's ability to keep up with its debt payments and finance new oil-field development.
Under the new plan, creditors would have to agree to honor a decision made between Batista and the company over the validity of the put option and Batista's ability to pay it. The put option was questioned and investigated by Brazilian prosecutors.
The plan also changes terms of the DIP loan that would consist of a three-portion bond sale entirely subscribed by the creditors. The company has already obtained a first portion of $125 million in fresh financing, with the remaining $90 million to be released in two portions after the passage of the restructuring plan.
Oléo e Gás shares rose 6.25 percent to 0.17 reais in afternoon trading in Sao Paulo on Monday, on track for their biggest one-day jump in more than three months.
Almost two years ago, when the company was faced with growing investor discontent over its performance, Batista promised to invest $1 billion in the company if shares fell to a certain level. However, Batista failed to fulfill his promise when the shares touched that level. Continuación...