Billion-dollar restructuring
The Casas Bahia Group, one of the best-known retail companies in the country, filed a request for approval of extrajudicial recovery. According to the initial statement, filed by Pinheiro Neto Advogados, the request focuses on readjusting the “financial liabilities” arising from the issuance of debentures and bank credit notes.
Casas Bahia Group, one of the largest retail chains in the country, filed for extrajudicial recovery
According to the document, the request is restricted and involves only the credits mentioned, not including debts with suppliers, employees and other creditors. Lawyers cite that the company has already extended more than R$4.1 billion in unsecured financial debts — those in which creditors do not have priority in settlement.
The request was filed in São Paulo because the company’s administrative structure is, for the most part, in the capital of São Paulo.
The restructuring of the billion-dollar debt is justified, in the petition, due to the period of health emergency (Covid-19 pandemic) and the high interest rate. Between September 2022 and September 2023, the Selic rate remained at 13.75% and raised Brazil to the highest real interest rate (already discounting inflation) in the world.
“On the other hand, especially after the judicial recovery of Americanas, there was an increase in the banking spread for credit lines for the Company and some financial institutions also reduced credit limits. Thus, lines of credit for the Company became more expensive and scarce. The increase in interest rates also directly affected the cost of credit for companies and consumers”, say the company’s lawyers in the request.
Other points cited for the request were the company’s downgrade in the S&P Global Ratings ranking and the devaluation of shares (consequence of a lower rating), which fell 80% since the second half of 2022.
The document is signed by lawyers Giuliano Colombo, André Moraes Marques, Thiago Braga Junqueira, João Guilherme Thiesi da Silva, Manuela de Carvalho Valente de Lima It is Maria Fernanda Marchesan Del Grande.
Click here to read the extrajudicial recovery request
Tags: Casas Bahia files request extrajudicial recovery Court
