Latin American Economy & Business - June 2016 (ISSN 1741-7430)

Oi files for bankruptcy: Oi, the only locally controlled mobile phone operator in Brazil, filed for bankruptcy protection with debts of BRL65bn (US$19bn) on 20 June, after rescheduling talks ahead of a EUR231m bond repayment failed to produce agreement. The company has been badly affected by the Brazilian recession, but analysts say it also suffered from serious problems caused by an attempt by the previous Partido dos Trabalhadores (PT) government to turn it into a ‘national champion’. Despite big ambitions and government help, the company was mismanaged (it had six chief executives in five years) and became heavily leveraged. State development banks BNDES and Caixa Económica Federal are reported to have lent BRL13bn (US$3.8bn) to the company.