We Want to Raise R$ 12 Billion to Get Past the Storm, Says Odebrecht President

04/01/2016 - 09h02

Under pressure from the corruption accusations of the Brazilian Federal Police's Lava Jato operation and by debts that amount to R$ 90 billion (US$ 25 billion), Odebrecht has put up for sale a package of company assets in an attempt to raise R$12 billion (US$ 3.3 billion) throughout the year.

"We believe that this amount will give us a good basis to get past this storm," says Newton de Souza, the president of Odebrecht group.

Souza became president in June 2015 after Marcelo Odebrecht was arrested – he was sentenced to 19 years in prison for crimes such as corruption and money laundering.

Folha - How can the attempt to get leniency and plea bargain agreements help the group to get out of the situation it is in now?

Newton de Souza - This is certainly not a comfortable situation and it makes our organizational mission difficult, but we intend to take all the necessary measures to create the bases for a new cycle in our organization.

In addition to the Lava Jato operation, there is a recession and Odebrecht has a debt of some R$ 100 billion [US$ 27 billion]. How do you intend to pay it?

The gross debt amounted to R$ 85 billion [US$ 23.6 billion] in 2014 - that was the last figure disclosed. It makes no sense to talk about a funded debt. All companies have debts in their cash flow. And we also need to look at the payment deadlines.

What are you going to put up for sale?

Some factors like short cash, loan contractions and the Lava Jato operation led us to begin a program to sell assets totaling R$ 12 billion [US$ 3.3 billion]. We believe that this amount will give us a good basis to get past this storm. We have put up for sale a hydroelectric power plant in Peru, a highway in Peru, which is already under the process of due diligence, and some participation in a petroleum block in Angola.

Are those actions intended to pay debts?

Selling assets leads to an immediate reduction in net debts. Also, when you sell an asset, the installments of the financing go with it. The R$ 12 billion [US$ 3.3 billion] that we intend to make will become net income for the company, but the deleveraging is bigger.

The accusations against Odebrecht are very serious, the company's president is in jail and the debt is very high. Are you going to manage to survive?

Yes, we are learning a lot with this crisis and we are creating solid bases to leave all this behind us - these are the pillars for a new cycle of growth. I am sure that we will manage to leave all of this behind us.

What does Odebrecht believe would be the best solution for the current political crisis?

I have no comment.

Translated by THOMAS MUELLO

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	Marisa Canuto/Valor
	Newton de Souza (R), current president of Odebrecht group, and Marcelo Odebrecht (L), former CEO, now in prison