UPDATE 1-Brazil's Odebrecht hires law firm for debt restructuring
(Adds Odebrecht statement on hiring law firm)
By Guillermo Parra-Bernal
SAO PAULO Aug 10 (Reuters) - Grupo Odebrecht SA, the engineering company ensnared in Brazil's worst corruption scandal, said on Wednesday that it had hired law firm E. Munhoz Advogados to advise on a debt restructuring plan.
In an emailed statement to Reuters, Grupo Odebrecht said that the law firm founded by corporate restructuring lawyer Eduardo Munhoz has been a contractor for the past six months. A source told Reuters earlier Wednesday that beginning in December, Munhoz had helped restructure the group's more than 100 billion reais ($32 billion) in debt.
Munhoz has advised Grupo Odebrecht on restructuring of 13 billion reais in liabilities at sugar, ethanol and power unit Odebrecht Agroindustrial SA and a debt renegotiation at oil and gas drilling unit Odebrecht Óleo & Gás SA, the statement said.
The source, who spoke on condition of anonymity, said that the firm's hiring is not aimed at preparing Grupo Odebrecht, Brazil's largest private-sector employer, for an in-court reorganization. The Salvador, Brazil-based firm denied a report in July by Brazil Journal blog that an accommodation with creditors was under way.
Reuters reported in April that Odebrecht had entered talks with banks to refinance up to 35 billion reais in loans, following the involvement of Latin America's largest engineering group in a corruption scandal that curtailed access to funding. While the company has sold some assets, other processes have hit a snag as a result of the scandal.
Some of the restructuring and reorganization processes in which Munhoz has participated as legal advisor includes OGX Petróleo & Gás Participacoes SA's $3.6 billion bond default in 2013, the largest in Latin America to date, and the bankruptcy protection filing for Odebrecht rival OAS SA.
Sao Paulo-based E. Munhoz Advogados did not comment. Bloomberg News first reported Munhoz's hiring on Wednesday.
($1 = 3.1276 Brazilian reais) (Reporting by Guillermo Parra-Bernal; editing by Grant McCool)
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