Shareholders of embattled Brazilian retailer Americanas SA voted to ratify most of the names proposed for its board of directors, after the firm sank into bankruptcy in January following the revelation of a massive accounting error.
(Bloomberg) — Shareholders of embattled Brazilian retailer Americanas SA voted to ratify most of the names proposed for its board of directors, after the firm sank into bankruptcy in January following the revelation of a massive accounting error.
At a general meeting held Saturday, Carlos Sicupira, one of the billionaire founders of 3G Capital Inc. that’s also among Americanas’ largest shareholders, was reelected to the board.Â
Minority shareholders managed to elect Pierre Moreau. He was proposed by Bonsucex Holding, Silvio Tini de Araujo, EWZ Brasil Fundo de Investimentos de Acoes and EWZ Investments LLC, which collectively hold more than 5% of the shares.
The company’s restructuring plan was also ratified, according to the meeting’s minutes.
Americanas shocked investors and creditors in January when its incoming chief executive officer resigned after just nine days following the discovery of a 20 billion real ($4 billion) accounting hole that doubled the debt load of the company.
Americanas is negotiating with Brazilian banks — its largest creditors — and an agreement could be reached in the coming weeks, according to people familiar with the talks. The proposal includes a capital injection of 10 billion reais with a potential for 2 billion reais of additional cash at a later date depending on a series of financial factors.
3G’s billionaire founders, Jorge Paulo Lemann, Marcel Telles and Sicupira, have already injected some cash into Americanas to ensure operations can continue during the bankruptcy protection process. The trio said in a statement earlier this year that they were unaware of the accounting problems at the firm.
While the crisis has seen the value of their holdings of Americanas shrivel, it’s hardly dented their overall fortunes. But their reputation as some of Brazil’s most highly respected business executives has taken a hit, with some banks and investors calling the Americanas debacle the biggest fraud in the country’s corporate history.
Americanas has staved off massive layoffs and store closures since the crisis hit but sales through their online platform have tumbled, according to a report released in March. The Rio de Janeiro-based retailer has vowed to sell assets including a natural food supermarket chain and other retail brands as well as a corporate jet. At least 2 billion reais of the proceeds would be used to pay debt, the company said in its restructuring proposal.
–With assistance from Danielle Chaves.
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