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UPDATE 3-Brazil's Oi appoints Teles as acting CEO - filing
November 24, 2017 / 8:54 PM / in 16 days

UPDATE 3-Brazil's Oi appoints Teles as acting CEO - filing

(Recasts to reflect appointment of new CEO)

By Tatiana Bautzer, Gram Slattery and Daniel Alvarenga

SAO PAULO/LISBON, Nov 24 (Reuters) - Brazilian telephone carrier Oi SA, which is operating under bankruptcy court protection, appointed Eurico de Jesus Teles Neto as acting chief executive after Marco Schroeder resigned from the post on Friday, the company said in a securities filing.

Teles Neto will also serve as legal director until the board deliberates on a permanent replacement, the filing said.

Schroeder left at a crucial phase in Latin America’s biggest-ever bankruptcy proceedings, after fissures deepened between the company’s management and board, run by shareholders aligned with distressed debt tycoon Nelson Tanure. Schroeder in recent months has urged shareholders and creditors to make concessions, while the board has stuck to a restructuring proposal rejected by major bondholder groups.

A spokeswoman for Portugal’s Pharol SGPS SA, which owns about 27.5 percent of Oi’s voting shares and is part of a controlling shareholder bloc, said earlier on Friday it had been informed of Schroeder’s decision to step down.

Common shares in Oi extended losses to close 4 percent lower after Reuters, citing three sources with knowledge of the situation, reported Schroeder had tendered his resignation Friday afternoon.

Oi is two weeks away from a crucial creditor vote on a proposal to restructure 65 billion reais ($20 billion) of debt, with the fate of the nation’s largest fixed-line phone operator at stake and more than 100,000 jobs on the line.

In October, telecoms regulator Anatel threatened to intervene in the carrier if it changed management.

However, a government source said on Friday Schroeder’s departure did not make intervention more likely. The person, who requested anonymity due to the sensitivity of the issue, said that talks to bring the debt-laden carrier out of bankruptcy protection will continue under new management.

Any restructuring plan approved by management must still be approved by the regulator before being presented in bankruptcy court, the person added.

$1 = 3.23 reais Reporting by Tatiana Bautzer and Gram Slattery in Sao Paulo, Daniel Alvarenga in Lisbon; Additional reporting by Leonardo Goy in Brasilia and Ana Mano in São Paulo; Editing by Cynthia Osterman and Richard Chang

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