Brazilian court suspends new transfers from Braskem to Mexico's Idesa
BAK•A Brazilian court temporarily blocked Braskem from transferring new funds to its Mexican unit, Braskem Idesa, as part of a $415 million financing package and a $71 million capital injection. The order remains in effect until further notice.
1. Transfers temporarily blocked
A court in São Paulo issued an order suspending new fund disbursements from Braskem to Braskem Idesa until further notice. The transfers were part of a $415 million financing package and a $71 million capital injection tied to the unit’s Chapter 11 filing; non-compliance could lead to fines and personal liability for company directors.
2. Creditor concerns
The ruling followed a creditors’ motion alleging the transfers would reduce Braskem’s capital position. Braskem Idesa, a joint venture between Braskem and Mexico’s Grupo Idesa, filed for U.S. Chapter 11 bankruptcy in August after reaching agreements with creditors and shareholders to restructure more than $920 million in debt. Braskem has also filed for out-of-court reorganization in Brazil and declined to comment on the order.
