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BNP Paribas, Banco Bradesco SA and Coöperatieve Rabobank are among the largest creditors of Brazilian sugar and ethanol company Raízen SA, which is seeking to restructure some $12.6 billion of debt out-of-court.
Disclosures by Raízen showed that the Paris-based BNP is owed 4.2 billion reais ($810 million) when the value of the debt is converted into the local currency, according to company documents released Wednesday. Banco Bradesco, Banco Santander SA, Coöperatieve Rabobank and Sumitomo Mitsui Banking Corp. are each owed around 2 billion reais, also on a currency-converted basis, while Itau Unibanco Holding SA has over 1 billion reais of exposure to the company.
Raízen, owned by Shell Plc and Cosan SA, agreed to start an out-of-court debt restructuring of its 65 billion reais debt, suspending payments and giving it 90 days to get buy-in from creditors on a more comprehensive plan. That could involve additional capital contributions from its owners, the conversion of some debt into equity or the sale of assets.
Trustee Bank of New York Mellon is cited on the documents as being owed the equivalent of approximately 26 billion reais, the documents show.
Securitization firm True Securitizadora is also listed among the largest creditors, owed about 6.4 billion reais. Securitization firms are responsible for the structuring of agribusiness receivables certificates, or CRAs, a class of relatively new fixed-income securities used to finance the sector that has helped fund Brazil’s agriculture boom.
Spokespeople for Bradesco, Sumitomo and Opea, the controller of True Securitizadora, declined to comment, while Rabobank’s said it doesn’t comment on market transactions. Itau Unibanco’s representative said it doesn’t comment on specific clients. BNP, Santander and BNY Mellon didn’t immediately return to requests for comments.
Once Brazil’s leading biofuels producer, Raízen has been undercut by high interest rates, weak harvests and heavy investments that have yet to pay off.
The price of its dollar-denominated bonds has slumped into levels that indicate a company is in distress. Its ratings were slashed deep into junk grade as concerns about its debt load mounted and talks for a rescue from its main shareholders dragged on.
(Updates with Sumitomo, Opea and Itau answers to requests on the sixth paragraph.)
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