By Anusha Shah and Luciana Magalhaes
Aug 18 (Reuters) - Mexican petrochemical firm Braskem Idesa, a joint venture of Brazil's Braskem and Mexico's Grupo Idesa, filed for Chapter 11 bankruptcy in the U.S. on Tuesday after reaching agreements with creditors and shareholders to cut debt by more than $920 million.
The company said it expects to emerge from its bankruptcy proceedings within 60 to 90 days, adding that the bankruptcy filing would not affect its day-to-day operations.
As part of the restructuring
agreement, the firm will raise capital and reduce its total senior debt from approximately $2.5 billion to about $1.6 billion.
Braskem, the majority shareholder, will contribute $476 million and retain its majority stake in the reorganized company, while Grupo Idesa and its affiliates will serve as the largest minority shareholder. Part of that amount, or $126 million, has already been paid, a person familiar with the deal told Reuters on Tuesday.
Additionally, Braskem Idesa said it will pay employee wages, benefits, trade vendors and unsecured creditors under court-approved motions.
Now, with the joint venture's restructuring underway, parent company Braskem is turning even greater focus to its domestic operations, discussing a restructuring in Brazil, the same person told Reuters.
The Brazilian petrochemical company, which is grappling with over $10 billion of its own debt, is discussing alternatives with creditors, including securing their approval to seek out-of-court restructuring, the person added.
Reuters reported last week that these filings, in Brazil and Mexico, could happen as early as this month.
(Reporting by Anusha Shah in Bengaluru and Luciana Magalhães in Brazil; Editing by Rashmi Aich and Lisa Shumaker)
