Exclusive: Brazil's Oi considers capital hike to accelerate reorganization

Reuters News
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Posted: Jun 09, 2017 12:05 PM

By Guillermo Parra-Bernal and Alexandra Alper

SAO PAULO (Reuters) - Oi SA is working on a proposal to raise 8 billion reais ($2.4 billion) in fresh capital from shareholders and investors as a way to accelerate the Brazilian wireless carrier's emergence from bankruptcy, Chief Executive Officer Marco Schroeder told Reuters on Friday.

Under terms of the plan, which are under analysis by Oi's executives and financial advisers, new stock would be offered to shareholders and, if some of them forgo the chance to subscribe, to other investors, Schroeder said in an interview. He declined to elaborate on the plan.

The new money would be used entirely to bolster Oi's balance sheet, enabling Brazil's fourth-largest mobile carrier to undertake more investments in fiber optic and connectivity, Schroeder said. He plans to present the plan to the company's board before the end of the month, he noted.

(Reporting by Guillermo Parra-Bernal and Alexandra Alper; Editing by Dan Grebler)