Dear team members,

Upholding the commitment that I undertook to keep you updated and to always act transparently, I announce that Odebrecht S.A., jointly with its parent companies and certain subsidiaries, was obligated today, June 17, to file for court-supervised reorganization in view of the coming due of certain liabilities and of legal claims that could generate significant losses for our companies.

The filing for court-supervised reorganization, whose purpose is to protect the Group and its team members, jobs, tangible and intangible assets, including technological, does not affect our Group’s operational companies, such as Braskem, OEC, Ocyan, OR, OTP, Enseada, OLI and Atvos, the latter of which already has filed for court-supervised reorganization. The reorganization filing involves R$51 billion in claims, excluding loans between the Group’s companies and first priority claims.

Both these companies and the holding company Odebrecht S.A. will continue to conduct their business activities normally. Therefore, it is important that you maintain the same level of dedication and concentration that you always have adopted in the execution and delivery of your action programs.

Please understand that, in our view, court-supervised reorganization is the most appropriate course of action at this time. It represents a change in environment to ensure our continued efforts in the group’s financial restructuring. As of today, the negotiations with creditors will be conducted collectively and will advance with protection from the courts for the company and its team members, along with greater coordination, security and transparency. Our goal remains the same: to reach a definitive and sustainable solution to our financial equilibrium, which is an indispensable step so that soon we can once again focus on our growth plans.

For some time you have been accompanying these efforts that all of us have been making to overcome the business challenges that first emerged in 2016. We are doing our homework. We have strengthened our corporate governance, which included creating or reinvigorating the board of directors of our Businesses with the inclusion of more independent directors in the Group and the adoption of new policies and directives. We have implemented our compliance system based on international references in best practices and are continually enhancing it with improvements to our internal processes and the use of tools needed to uphold our commitment to acting ethically, with integrity and transparency and our commitment to meeting all the obligations undertaken in the leniency agreements signed in Brazil and other countries.

You also have perceived in your day-to-day activities how we have constantly sought to reduce our administrative expenses. We also our focusing on shoring up our liquidity and on deleveraging by divesting assets. On this front, we have successfully concluded the sales of Odebrecht Ambiental, Embraport, Via Rio, Via 4, Ótima, Galeão, Rota das Bandeiras, Supervia, Logum, Complexo Eólico Corredor do Senandes, Rutas de Lima and Chaglla.

Meanwhile, we also have made capital contributions to support the operations of several of our Businesses. Since 2016, we have injected R$6 billion into Atvos, R$1 billion into OEC, US$530 million into Ocyan, R$900 million into Enseada and R$500 million into OR.

Of course, during this period, Brazil’s most serious economic crisis of decades has significantly weighed on the recovery of our Businesses. Furthermore, we have not yet received full recognition for having completely transformed our organization and for transcending the wrongdoings that we committed in the past, which makes it more challenging to tap new sources of credit and liquidity.

In this scenario, the court-supervised reorganization will give Odebrecht S.A., which has guaranteed a large portion of the loans taken out by the operating companies, the tranquility, transparency and resilience to reorganize its strategy in coordination with its creditors. The rationale of the institution of court-supervised reorganization is to preserve the company so that, by maintaining its normal business activities, it can, through its own efforts, surmount its financial crisis. I am confident that we will successfully get through this phase.

And you team members are a critically important part of this process.

I am counting on you.

Warm regards,
Luciano Guidolin
Chief Executive Officer
Odebrecht S.A.

For more information, click here to consult the Questions and Answers

To accompany the steps of the court-supervised reorganization, go to https://www.odebrecht.com/en/communication/court-supervised-reorganization-odebrecht-sa