Brazil Court Names Judicial Administrator for Oi

Published 25/07/2016

SÃO PAULO—A Brazilian local court named two firms to be judicial administrators of troubled telephone company Oi SA during its judicial recovery process.

The local court, based in Rio de Janeiro, named audit company PricewaterhouseCoopers Assessoria Empresarial and law firm Escritorio de Advocacia Arnoldo Wald to be administrators.

“The judicial administrators will be responsible for supervising and assisting in the judicial recovery process of Oi, presenting individual reports on the development of the company’s activities,” said the local court.

Oi filed the largest bankruptcy-protection request in Brazil’s history on June 20, just days after debt-restructuring talks with creditors collapsed. The filing by Oi and six subsidiaries lists 65.4 billion reais ($20 billion) in debt.

Since 2009, the company has accumulated a huge amount of debt to complete two mergers, first with Brasil Telecom and later with Portugal Telecom. Those deals had failed to generate enough cash flow to fund the company’s investment needs.

Oi has low penetration in the mobile phone and broadband markets, the most critical and profitable segments of the telecommunications sector in Brazil, according to analysts.