Agrenco switches counsel for latest restructuring - News - Latin Lawyer
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Agrenco switches counsel for latest restructuring
Thursday, 7th July 2011 by Joe Rowley
Castro, Barros, Sobral, Gomes Advogados has replaced Felsberg, Pedretti e Mannrich Advogados e
Consultores Legais to help Agrenco agree a modified restructuring plan with its creditors.
Agrenco's has opened the first of two soybean processing plants after its restructuring. (Credit: pennylayn)
The plan, which was approved by the creditors on May 6, saw Bermuda-based Agrenco Limited inject some 130
million reais (US$83 million) into its Brazilian subsidiary and remains subject to ratification by the judge
overseeing the case.
The additional funds were introduced into Agrenco (Brazil) throughout May and June and were used to complete
the Alto Araguaia plant, which started operations on 27 June.
The date for the completion of a second plant is unknown and remains subject to additional funds.
Counsel to the various creditors was given by a 'petit committee' comprised of Pinheiro Neto Advogados and
Wald Associados Advogados, with Veirano Advogados advising WestLB.
The creditors were made up of HSH Nordbank, as secured lender, with ABN Amro Bank, Mercantil
Commercebank and Rosemount Capital Management as unsecured lenders.
Additional counsel to the creditors was given by Deccache Advogados Associados and Santos Neto Advogados,
which advised Deutsche Bank, Natixis and Societé Generale.
Deloitte, which was brought in by the court as judicial admininstrator, turned to Xavier, Bernardes, Bragança,
Sociedade de Advogados.
Asked about the reaction to Agrenco's decision to bring in Castro Barros in place of Felsberg, Veirano partner
Leonardo Morato says the move was "very well received by creditors," adding that Castro Barros has now been
asked to represent the whole Agrenco Group.
Felsberg was unavailable to comment before publication.
Glencore, previously represented by TozziniFreire Advogados, were advised by Rodrigues, Tavano, Maier e
Sendai Advogados.
Morato explains that with Glencore reluctant to invest more money in Agrenco (Brazil) without the involvement of
its creditors, the company "saw the situation as an opportunity" and struck a US$130 million deal with GEM - a
fund that works with distressed listed companies - to structure an offer to creditors.
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Agrenco switches counsel for latest restructuring - News - Latin Lawyer
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"The fresh monies are being injected in Agrenco Brasil Group under the judicial reorganisation and are fiscalised
by creditors," he says.
"In return GEM is able to sell BDRs in the market and make money to cover its fees for the operation."
He adds that while the creditors have approved the terms and conditions of the plan, the new loan will be
"subordinated to all other credits" since the loan is provided by Agrenco Limited to Agrenco (Brasil) and the
creditors did not have any relationship with GEM whatsoever.
Under the terms of the new restructuring plan, the additional funds can only be used for working capital and to
finance the start-up of the activities of the Alto Araguaia and Caarapó soybean processing plants.
Repayment of the loan will begin on 31 December 2012 only if, and after all, creditors of have been repaid.
All companies will retain their 'restructuring status' until the end of the following year.
Castro Barros was hired by Agrenco (Brazil) in June to advise the company on its restructuring proceedings and
related lawsuits.
Partner Sérgio Savi says that the greatest challenge in the restructuring came from the "short time frame"
available to the firm to get to grips with the restructuring through them being hired at short notice.
"This case has a lot of history and a complexity scarcely seen in reorganisation plans," he explains. "The
creditors are well organised and represented by different law firms and in house counsel, making negotiations
harder."
He adds: "Every single clause and word had to be discussed in detail, which meant making headway was very
time consuming and required us to work non-stop for two whole weeks."
Xavier, Bernardes, Bragança, Sociedade de Advogados was retained by Deloitte to follow up the restructuring
process.
Asked about the significance of the new restructurng plan, partner Horácio Bernardes Neto says that in view of
the "difficulties" Agrenco was facing, the agreement could have "very important implications for the recovery of
their activities and the payment of their creditors" despite being strictly subject to the restructuring plan.
Marcos Monteiro Schroeder is a partner at Wald e Associados Advogados. He says that for his team the
negotiations with the creditors were "particularly tough" due to requirements made by the them that the loan be
subordinated and payable "only when and if all creditors had been repaid".
He adds that "given the absolute absence of cash and no other source of funding available," a well-coordinated
process by the key banks and their counsel was crucial to the success of the negotiations.
The latest deal follows a previous agreement reached between Agrenco and its creditors in February last year
which sought to restructure some US$650 million in debt.
Counsel to Agrenco
Castro, Barros, Sobral, Gomes Advogados
Partner Sérgio Savi and associate Eduardo Takemi Kataoka
Counsel to Glencore
Rodrigues, Tavano, Maier e Sendai Advogados
Partner Marcelo Rodrigues
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Agrenco switches counsel for latest restructuring - News - Latin Lawyer
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Counsel to HSH Nordbank, ABN Amro Bank, Mercantil Commercebank and Rosemount Capital
Management
Pinheiro Neto Advogados
Partners Luiz Fernando Paiva, Bruno Balduccini, José Luiz Homem de Mello and Giuliano Colombo and
associates Fernando Mirandez, Joana Bontempo and Tatiana Guazzelli
Counsel to Credit Suisse Brazil
Wald e Associados Advogados
Partner Marcos Monteiro Schroeder and associates Fernando Vila Magno and Marcelo Rodrigo Lopes
Counsel to WestLB
Veirano Advogados
Partner Leonardo Morato
Counsel to Deutsche Bank, Natixis and Societé Generale
Deccache Advogados Associados
Associate Mirella Guedes Campel
Santos Neto Advogados
Associate Renata Jordão
Counsel to Banque Cantonale de Genève
Wald e Associados Advogados
Partner Renata Machado Veloso
Counsel to Deloitte
Xavier, Bernardes, Bragança, Sociedade de Advogados
Partners Horácio Bernardes Neto and Luis Augusto Roux Azevedo and associates Fernando Lobo and Leandro
Bauch
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