Brazilian shipbuilder Ecovix filed for bankruptcy

EcovixThe Brazilian shipbuilder Engevix Construcoes Oceanicas (Ecovix) filed for bankruptcy protection from creditors. The company and its five subsidiaries is struggling from 2.4 billion USD debt, accumulated during a downturn in the market for new ships and collapse in the shipbuilding sector. Ecovix failed to agree with creditors for debt restructuring and suffered from low liquidity and low cash flows, which pushed the shareholders to fill for bankruptcy protection. The bankruptcy proceedings will be done at the federal commercial court in the southern state of Rio Grande do Sul. Ecovix said that Banco Brasil Plural SA and law firm Felsberg Advogados will advise it through the bankruptcy protection proceedings.

Almost half from the debt is to the Tupi/BV, a consortium formed by Petrobras, BG Group and Galp. About 442 million USD refers to loans held by Ecovix from banks Caixa Econômica Federal, Bradesco and Banco do Brasil. Another 300 million USD are to suppliers like China’s Cosco and the Norwegian NOV. A smaller amount of the company’s debt is to labor creditors, but refers to outstanding actions and possible unpaid amounts.

Earlier this week, the company laid off 3,800 workers.

The shipbuilder Engevix Construcoes Oceanicas (Ecovix) is a subsidiary of Engevix Angenharta S/A and run for Petrobras two contracts to build eight FPSO in the pre-salt. The company operated dry dock at the Port of Rio Grande.