By Rogerio Jelmayer And Luciana Magalhaes
SÃO PAULO--Some major creditors of Brazilian power company Eneva
SA are pushing for a $791-million debt-for-equity swap in the
troubled company once owned by failed tycoon Eike Batista, with the
aim of bringing the firm out of bankruptcy protection, according to
people familiar with the proposal.
The debt-for-equity deal, valued at about 2.4 billion reais, is
part of a 3 billion reais capital plan to be discussed at a
creditors assembly scheduled for April 30. Large creditors, mainly
banks, are already eyeing an eventual sale of their stakes in the
firm, the people said.
If the plan is approved, Brazilian bank BTG Pactual will likely
emerge as the utility's main shareholder, with a 40% stake. Two
other lenders, Itau BBA and Citibank, will also become relevant
shareholders. Germany's E. ON. SE, which currently holds a 43%
interest in the company, will see its stake diluted to around 10%
to 20%, while Mr. Batista's interest will drop to around 5% of the
restructured company from around 20% currently, one of the people
said.
Mr. Batista couldn't be reached for comment.
A spokeswoman for E.ON confirmed that E.ON's stake in Eneva
would shrink if the proposed recovery plan is approved, but
couldn't provide exact figures.
Formerly known as MPX Energia SA, the company was founded in
2001 by Mr. Batista and is another casualty of his crumbled
industrial empire. The Brazilian businessman sold a majority stake
in the utility to E. ON SE in 2013, but maintained co-control of
Eneva, a power generation and trading company, with businesses in
natural gas exploration and production.
Eneva filed for bankruptcy protection last December for its
holding company Eneva S.A, and Eneva Participações units, after the
firm's lenders refused to renew an accord to refinance its debt.
Seven thermal electricity plants operated by Eneva weren't included
in the BRL2.4 billion petition.
Eneva's total debt, including project finance to some power
plants, is around 5 billion reais, according to the company's 2014
financial results.
The company owes around 1 billion reais to BTG Pactual; 707
million reais to Banco Itau BBA, the investment arm of Itau
Unibanco; and 387.9 million reais to Citibank, according to Eneva.
The financial institutions declined to comment.
While the creditors will likely soon become shareholders in
Eneva, some are already making plans to put their stakes up for
sale, according to a person familiar with the talks who didn't
unveil a potential price for the sale nor the potential buyers.
They "just want to save the company from bankruptcy," the person
said.
Eneva is the fourth company founded by Mr. Batista to seek
bankruptcy protection, including his flagship oil firm, Oleo e Gas
Participações, whose failure sunk his other holdings.
Once Brazil's richest man, Mr. Batista has been charged with
insider trading and other financial crimes related to the meltdown.
His criminal trial in a Rio de Janeiro court was halted in March
after the judge in charge of the case was accused of alleged
wrongdoing. A new judge has been appointed, but it could take
months for proceedings to resume.
Mr. Batista has previously denied the accusations against
him.
Friedrich Geiger contributed to this article.
Write to Rogerio Jelmayer at rogerio.jelmayer@wsj.com and
Luciana Magalhaes at Luciana.Magalhaes@dowjones.com
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