Brazil Court Approves Bankruptcy Protection For Odebrecht’s Successor

The request for bankruptcy protection by OEC, the successor of Odebrecht, has been accepted by a court in Brazil. This acceptance marks a significant moment for the company, which has been navigating through troubled waters for some years. OEC, officially known as OEC Engenharia e Construção, applied for bankruptcy protection on April 24. They cited the impact of the COVID-19 pandemic and difficulties in obtaining new contracts as reasons behind their financial troubles. With this court decision, OEC now follows in the footsteps of its predecessor, Odebrecht, which filed for bankruptcy protection in 2019.

The company’s total debts stand at approximately BRL 98 million (USD 19 million). These include debts with suppliers, banks, and other creditors. Despite these challenges, OEC aims to continue its operations while reorganizing its finances. The decision was handed down by Judge Leo de Almeida Fagliari of the 1st Bankruptcy and Judicial Recovery Court of São Paulo. He stated that the acceptance of the request was justified given the circumstances faced by OEC. The judge highlighted the COVID-19 pandemic’s severe impact on the company’s revenues and overall business performance.

Alongside these financial woes, OEC had also faced reputational damage due to corruption scandals that plagued Odebrecht. These controversies resulted in the exclusion of OEC from several major infrastructure projects. Despite efforts to rebuild its image and secure new contracts, the economic situation exacerbated by the pandemic has proven to be a tough hurdle. Now, with the judicial protection in place, OEC looks to restructure its debts and stabilize its business. The company’s leadership remains optimistic, seeing this as a critical step towards sustaining its operations and securing future opportunities in the construction sector.

Read the full story by: BNamericas