Struggling Brazilian oil firm OGX has been granted bankruptcy protection – but two of its foreign subsidiaries have been refused the same status.
The company, which failed to secure more than $5billion of refinancing, has been in peril since the collapse of former billionaire Eike Batista’s business empire.
It had sought protection from creditors, and now has 60 days to come up with a restructuring plan.
However, the company’s OGX Internacional and OGX Austria spin-off firms were refused protection, with the judge ruling they must be decided by courts in their respective home countries.
The ruling paves the way for creditors to pursue debts through OGX Internacional and OGX Austria, potentially hampering the restructuring process.
OGX is to appeal the ruling as it prepares to deal with the fallout of Latin America’s largest corporate bankruptcy filing in history.