Braskem Shareholders Withdraw $1.4 Billion Funding Proposal After Creditors Reject It
Key Facts
Braskem’s shareholders withdrew a nonbinding proposal to inject $1.4 billion into the company after bondholders rejected a proposal to convert $3.8 billion of debt into equity, according to a Bloomberg report published by Invest News on November 6. The proposed capital injection from Petrobras, IG4 and Braskem’s shareholders was conditional on creditors approving the conversion of debt into an ownership stake in the company. The report cited people familiar with the matter as saying that disagreement over those conditions led shareholders to withdraw the proposal from discussions. The decision followed meetings with creditors in New York during the week the report was published. In a separate filing with the U.S. Securities and Exchange Commission, Braskem said meetings with major shareholders and investors had not produced agreement on the final restructuring terms.
The withdrawal of the proposed funding puts negotiations at a direct impasse over how to distribute the burden of restructuring between new capital and converting debt into equity in the company. The shareholders’ proposal tied a $1.4 billion contribution to creditors’ approval of the conversion, while the proposal rejected by bondholders involved converting $3.8 billion into equity. The report did not say that the parties had reached an alternative agreement after the proposal was withdrawn. In its official filing, Braskem said major shareholders and investors had yet to agree on the final terms. It also said it expects to continue discussing and negotiating the updated plan with investors, while maintaining dialogue with its other financial creditors.
The current negotiations date back to Braskem’s out-of-court restructuring request filed on August 24, 2026, aimed at providing a legal framework to negotiate and implement a restructuring of its unsecured financial obligations. Claims held by unsecured creditors that signed the plan account for 39.6% of the claims covered by it, according to the company’s filing. The plan calls for an updated proposal within 90 days of filing the request. In the latest extension cited by the company, October 30, 2026, was set as an interim target date for reaching an initial agreement on the plan’s commercial terms. But the same filing confirmed that agreement on final terms had not been reached and negotiations would continue.
Broader proposals reported during coverage of the October negotiations involved billions of dollars, with the parties differing over the size of the debt conversion and new funding. Under a proposal reported by Reuters on October 26, creditors would convert $2.8 billion of debt into equity, while shareholders and third parties would commit $1.2 billion as part of a subsequent offering valued at $2.25 billion. The coverage estimated the capital injection and initial conversion at about $4 billion under the creditors’ proposal, compared with about $5 billion under Braskem’s proposal. Coverage citing Bloomberg also said the creditors’ proposal included a request for a $1.85 billion guarantee for the subsequent offering, along with an additional immediate debt conversion of the same amount. Those figures concerned negotiation proposals in October and were not agreed final terms.
Reuters’ coverage on October 26 estimated the debt the parties are seeking to restructure at about $11 billion. In its second-quarter results, Braskem said net income was $664 million and that wider chemical and petrochemical margins in international markets contributed to higher gross profit. This background gives a sense of the scale of the restructuring and its financial context, while the publicly disclosed disagreement in negotiations remains focused on debt-conversion and capital-injection provisions. According to Bloomberg, judicial reorganization has returned to discussions among the company and its shareholders as disagreements over key negotiating terms continue. Braskem told Bloomberg it maintains regular communication with the market and that any developments would be announced through its official channels in due course.
In trading, BAK shares closed at $1.06 on November 5, down from $1.12 in the previous session, then posted $1.09 on November 6, according to EL7 data. The November 5 close was from the session before the report on the proposal’s withdrawal was published on November 6, while the November 6 close was from the session on the day it was published. A report citing Bloomberg had earlier said the parties had until November 22, 2026, to finalize an agreement, with the possibility of reaching one sooner. Braskem, meanwhile, said in its filing that it expects to continue negotiations with investors and financial creditors. The company did not announce a new final agreement in the filing after the interim deadline was extended to October 30.