Ambipar Participações e Empreendimentos SA, a Brazilian waste management company, is in active negotiations with law firm Cleary Gottlieb Steen & Hamilton regarding a possible debt restructuring, according to sources familiar with the matter.
According to them, the discussions are at an advanced stage, although there is no formal mandate yet. One source clarified that a group of bondholders is preparing for the negotiations in parallel. Representatives of Ambipar and Cleary declined to comment.
Judicial Protection
On Thursday, a court in Rio de Janeiro granted Ambipar temporary protection from creditors, halting all collection and enforcement actions for 30 days, with the possibility of an additional month. The company said it faced the threat of financial collapse after some creditors demanded early repayment of debt, which could trigger cross-default conditions on liabilities worth 10 billion reais (approximately $1.9 billion).
Market Pressure
Following the news, Ambipar’s dollar-denominated bonds plunged 22 cents to a record low of 14 cents per dollar. The company’s shares plunged 61% on the São Paulo stock exchange, posting the largest intraday drop in the company’s history.
Challenging Period
This situation unfolds amid a challenging month for Ambipar, which faces heightened regulatory scrutiny, negative ratings agency outlooks, and management changes.
