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OGX hires financial firm Lazard as adviser

BY LUCIANA MAGALHAES and EMILY GLAZER

SAO PAULO -- Independent financial advisory firm Lazard confirmed Tuesday that it has been hired by Brazilian oil company OGX Petroleo Participacoes. OGX, controlled by embattled Brazilian businessman Eike Batista, is on the verge of a debt restructuring.

Last month, OGX hired restructuring bankers at U.S.-based Blackstone Group LP to provide financial advice.

Batista, as controlling shareholder, tapped Lazard about a week ago to work alongside Blackstone, a person familiar with the matter said.

OGX creditors also signed nondisclosure agreements last week, allowing them to review nonpublic company information and take steps toward a restructuring deal, this person said.

Following those agreements, OGX creditors and advisers met last week in New York.

OGX´s major creditors are represented by European investment bank Rothschild Inc. and law firm Cleary Gottlieb Steen and Hamilton LLP.

OGX representatives weren' t immediately available for comment. Another person familiar with the talks, however, said Lazard will be OGX´s financial advisor and will work together with Blackstone in talks with creditors as well as in search for debtor-in-possession financing. OGX also recently tapped restructuring lawyers at Davis, Polk & Wardwell LLP.

OGX has some $3.6 billion in dollar-denominated debt, which currently trades below $0.20 to the dollar, according to FactSet.

OGX, the flagship of Batista´s EBX group, is strapped for cash after its only producing oil field failed to live up to expectations. The firm has slashed back on its investments to concentrate on one new field, Tubarao Martelo, to come online by mid-2014, but analysts have said the firm may run out of cash long before then.

Earlier Tuesday, Brazil´s Valor Economico newspaper reported Lazard had been retained by OGX.

Dow Jones Newswires

09/24/2013

 

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