Libra Group has filed for protection at the Săo Paulo Court of Justice so it can renegotiate its debts, totalling R$1.8B, with its creditors. The company has undertaken to carry out operations normally at its terminals in Santos and Rio de Janeiro
It has 60 days to agree a debt restructuring plan.
Libra has been in a long-standing dispute with Santos port authority (Codesp) over lease charges. This matter is now being looked at by the Arbitration and Mediation Centre of the Brazil-Canada Chamber of Commerce. It adds that dredging delays have exacerbated its problems.
The Audit Court (TCU) wants the federal government to tender the areas occupied by Libra in Santos, arguing that the renewal of the lease in 2016 was illegal. However, the company says that the court’s decision was influenced by an unwarranted police investigation into its negotations to sell an airport and Companhia de Navegação da Amazônia, Brazil’s leading transporter of liquid bulk in the inland waterway system.
There are also new claims that the lease renewal was not illegal because a clause had been inserted in the 2015 Ports Act by the then President of the Chamber of Deputies, that allowed companies with big debts to renew their port leases provided they filed for debt arbitration.