JBS, Eldorado bonds slump as judge asks CEOs to step down
By Paul Kilby
NEW YORK, Sept 6 (IFR) - Bonds linked to Brazilian company J&F tumbled multiple points on Tuesday following news that a judge had ordered several top executives to step down as part of a fraud investigation.
Top managers at companies under the J&F holdings umbrella - including meatpacker JBS and pulp producer Eldorado - were asked to suspend their corporate roles and stop all capital markets activity, Reuters reported on Monday.
The latest probe into fraud at state-owned pension funds has only added to the lingering uncertainty hanging over a Brazilian corporate sector still suffering from a long-running corruption scandal at oil company Petrobras.
"People invested in JBS bonds are waiting to see if more news emerges, but for now they are not too scared as the investigation seems to be more concentrated in the holding company and Eldorado," said a sell side analyst.
JBS USA's 5.875% 2024s were being quoted at 101.25 Tuesday after being spotted as high as 104.375 late last week, according to Trace.
Eldorado's 8.65% 2021s, meanwhile, were hit harder, falling to 81.10 from the 88.00 level seen last Thursday.
In a statement issued on Tuesday, JBS said it didn't have access to the judge's ruling, but would communicate to the market once it did.
Press representatives for J&F and Eldorado told Reuters on Monday that their executives were collaborating with the investigation. Continuación...