(Recasts to add details, background, bond performance
By Tatiana Bautzer and Guillermo Parra-Bernal
SAO PAULO Nov 23 Federal prosecutors and
Odebrecht SA have agreed on the world's biggest plea and
leniency deal under which the embattled engineering conglomerate
would pay around 7 billion reais ($2.1 billion) in fines related
to its role in Brazil's biggest corruption scandal, local media
Under terms of the deal, which was formalized on Wednesday,
Odebrecht would be allowed to bid for new government contracts,
lifting a suspension imposed over its involvement in the graft
and bribery scheme at state companies.
A separate leniency deal would be signed on Thursday, news
channel GloboNews reported.
Salvador, Brazil-based Odebrecht declined to comment. A
press representative for the Prosecutor-General's Office in
Brasilia declined to comment, saying it has no authorization to
comment on potential plea deals.
Reuters reported this month that the size of Odebrecht's
leniency deal would exceed a 2008 agreement in which German
engineering company Siemens AG paid $1.6 billion to U.S. and
European authorities for paying bribes to win government
The price on Odebrecht's 7.5 percent perpetual bond
jumped more than 1 cent on the dollar to 54 cents
at mid-afternoon trading on Tuesday. At that price, yields slid
to 14.05 percent from about 14.25 percent on Wednesday.
Latin America's largest engineering firm has been accussed
by prosecutors of overcharging state-controlled oil company
Petróleo Brasileiro SA and other state companies for
contracts and paying bribes to politicians. The agreement is key
to the restructuring of Odebrecht's 110 billion reais in debt.
Since August, law firm E. Munhoz Advogados has been advising
the talks with banks and investors.
Marcelo Bahia Odebrecht, Odebrecht's former chief executive
officer and the scion of the family that owns the conglomerate,
has been in jail since June 2015 and was sentenced to 19 years.
According to GloboNews, executives included in the plea deal
are expected to begin testifying within two or three weeks. At
least 78 Odebrecht executives and staff have agreed to join the
plea deal, the TV channel said.
($1 = 3.3560 reais)
(Additional reporting by Anthony Boadle in Brasilia, Eduardo
Simoes and Bruno Federowski in São Paulo; Editing by Larry King
and Andrew Hay)