Samarco files lawsuit against its creditors

Tuesday, 21 June 2022 22:55:24 (GMT+3)   |   Sao Paulo

Brazilian iron ore and pellet producer Samarco, controlled by the miner Vale and BHP, has filed a lawsuit against its creditors in a civil court of Belo Horizonte, state of Minas Gerais.

Samarco claims that the plan that could result in the change of control of the company, as previously reported by SteelOrbis, is not legal, as it has different treatments to creditors in accordance with their classifications.

According to Samarco, the creditors expect to receive 119 percent of their credit rights, while Vale would receive only 96.15 percent and BHP 96.37 percent of their own respective rights.

Other point raised by Samarco is the establishment of a new position, Director for Restructure, with veto powers on the decisions of the administrative and operational boards of the company. Samarco has further claimed that the plan does not take into consideration tax credits in the amount of $2.6 billion that the company has.

Sources quoted by the local press have mentioned that the full adoption of the creditors plan could result in the bankruptcy of Samarco. A session of conciliation is expected to take place today in the civil court, among all parties involved.

Samarco is in judicial recovery since April 2021, resulting from the collapse of its Fundao waste dam in 2005, which caused 19 deaths and a massive environmental disaster.

LuizCompagnoni
Luiz Compagnoni
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I am a retired mechanical engineer, covering the steel industry in Latin America, from iron ore to finished products, over the last 20 years.

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