Latin American petrochemical producer Braskem Idesa has reached what it describes as a ‘comprehensive consensual restructuring agreement’ with its major stakeholders to slash debt by more than $920 million.
The Mexican company, which was founded in 2010 and established through the association of Braskem, the continent’s largest thermoplastics producer, and Grupo Idesa, one of the leaders in the Mexican petrochemical industry, filed for Chapter 11 bankruptcy in the US on 18 August.
Braskem Idesa said it expects to emerge from these proceedings within 60 to 90 days with day-to-day operations continuing as normal.
The company’s petrochemical complex, in the municipality of Nanchital, Veracruz, focuses on the operation and production of ethylene, LDPE and HDPE.
Ethylene and PE production
Established in April 2016, it supplies 1.05 million tonnes of ethylene and PE annually.
In a press statement, the company said the financial solution will raise both fresh capital and reduce total senior debt from approximately $2.5 billion to approximately $1.6bn.
Under the restructuring agreement, Braskem, the company’s majority shareholder, will contribute a total of $476m and retain a majority stake in the company’s reorganised equity.
Grupo Idesa and its affiliates will be the company’s largest minority shareholder.
The agreement would position Braskem Idesa for ‘long-term operational and financial success’, the company said.
