The Egyptian billionaire Naguib Sawiris and a group of Oi's bondholders have submitted an alternative restructuring plan for the Brazilian operator. In a statement, the group advised by Moelis & Co said their plan will provide new capital and management expertise for the company, and unlike Oi's own debt restructuring plan submitted in September, would gain swift approval from the company's creditors. The ad hoc group of export credit agencies, facility agencies and banks represented by FTI Consulting already expressed support for the alternative plan.
Under the deal, Oi would raise USD 1.25 billion in new capital through a public share offering. Sawiris would provide USD 250 million the amount. Around USD 24.8 billion of Oi's debt in bonds would be swapped for 95 percent of the company's equity, and the remaining USD 5.8 billion would be exchanged for new bonds.
The investors also plan to negotiate new terms for Oi's debt with export agencies, banks and Anatel, and secure new working capital to help catch up on investment in the company. Sawiris estimates the company needs to spend BRL 37 billion over five years to restore its network equality. Oi's governance structure would also be "wholly revised", with a new board of directors with four independent members.
The alternative plan was presented to Oi and will be shared shortly with the restructuring court and judicial administrators. The group is also in talks with Oi's other main assembly of bondholders to assess their support for the plan.
