Sete Brasil Participacoes's creditors, including Banco do Brasil and Itau Unibanco Holding, received 2.68 billion reais ($938 million) from a government-backed fund and will likely tap about 1.58 billion reais more, according to a person familiar with the matter.
Creditors withdrew the money from the fund created with government assets in 2008 after Sete Brasil couldn't repay US$3.8 billion ($5.3 billion) in outstanding debt, said the person, who asked not to be identified because the matter is private. Data from Brazil's securities regulator show the fund reported a 2.11 billion-real withdrawal on Feb 10 and an additional 566.5 million reais on Feb 12.
The group of six creditors will soon take out the remaining balance to cover part of Sete's debt, the person said. The fund, which was created to guarantee lending for ship and oil-rig construction in Brazil, had assets of about 1.58 billion reais on Feb 12, regulatory data show. By tapping the money, the banks are essentially transferring the onus of collecting the debt to the naval fund, which is operated by state-controlled lender Caixa Economica Federal, the person said.
Banco Bradesco, Banco Santander Brasil, Caixa and Brazilian workers fund FI-FGTS are among other creditors benefiting from the move. Sete Brasil had planned to build the world's biggest deep-water drilling fleet for Petroleo Brasileiro (Petrobras) before the oil giant and the rig builder were engulfed in Brazil's biggest-ever corruption scandal.
Representatives for Itau, Bradesco, Banco do Brasil, Santander, Sete Brasil and FI-FGTS declined to comment. Caixa declined to comment saying the transaction is protected by bank secrecy.
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Creditors withdrew the money from the fund created with government assets in 2008 after Sete Brasil couldn't repay US$3.8 billion ($5.3 billion) in outstanding debt, said the person, who asked not to be identified because the matter is private. Data from Brazil's securities regulator show the fund reported a 2.11 billion-real withdrawal on Feb 10 and an additional 566.5 million reais on Feb 12.
The group of six creditors will soon take out the remaining balance to cover part of Sete's debt, the person said. The fund, which was created to guarantee lending for ship and oil-rig construction in Brazil, had assets of about 1.58 billion reais on Feb 12, regulatory data show. By tapping the money, the banks are essentially transferring the onus of collecting the debt to the naval fund, which is operated by state-controlled lender Caixa Economica Federal, the person said.
Banco Bradesco, Banco Santander Brasil, Caixa and Brazilian workers fund FI-FGTS are among other creditors benefiting from the move. Sete Brasil had planned to build the world's biggest deep-water drilling fleet for Petroleo Brasileiro (Petrobras) before the oil giant and the rig builder were engulfed in Brazil's biggest-ever corruption scandal.
Representatives for Itau, Bradesco, Banco do Brasil, Santander, Sete Brasil and FI-FGTS declined to comment. Caixa declined to comment saying the transaction is protected by bank secrecy.
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