Ambipar Emergency Response: When Parent Company Scandals Topple Healthy Subsidiaries

Ambipar Emergency Response is a Cayman Islands-based holding company for an emergency response and crisis management business operating in 40 countries with more than 500 operational bases and over 20,000 employees. It filed for chapter 11 bankruptcy protection on October 20, 2025, reporting approximately $1.07 billion in assets and $328 million in liabilities. The company's stated net worth exceeded $600 million.

The filing followed parent company Ambipar Participacoes e Empreendimentos S.A.'s Brazilian recuperacao judicial proceedings, which cited irregularities in the contracting of swap operations by its finance department. The former chief financial officer transferred swap contracts from Bank of America to Deutsche Bank and later amended them to include speculative elements. Within weeks, the parent company declared total debt of 10.48 billion reais ($1.94 billion) in Brazilian recuperacao judicial proceedings, and the subsidiary filed for chapter 11 alongside those proceedings.

Debtor(s)	Ambipar Emergency Response
Court	U.S. Bankruptcy Court, Southern District of Texas (Houston Division)
Case Number	25-90524
Judge	Hon. Alfredo R. Perez
Petition Date	October 20, 2025
Assets	~$1.07 billion
Liabilities	~$328 million
Stated Net Worth	~$600+ million
Green Notes Guarantee Exposure	$328 million principal
Case Funding	$3 million (parent company, non-loan)
Controlling Shareholder	Ambipar Participacoes e Empreendimentos S.A. (70.8%)

From Brazilian Startup to Global Emergency Response Business

The company began in 1995 when Tercio Borlenghi Jr. founded the business that would grow into the Ambipar Group. The corporate structure took shape in 2008 with incorporation as Planeta Ambiental—Central de Servicos Escolhas, followed by formation of Ambipar Participacoes e Empreendimentos S/A in September 2010 to consolidate group companies under a holding structure.

International expansion trajectory. The company's first venture beyond Brazil came in July 2012 through acquisition of a 51% stake in Holding Emergencia Participacoes, establishing its Chilean operations. The June 2016 acquisition of Ecosorb created the company's marine emergency response division. The October 2018 acquisition of Braemar Response expanded operations into the United Kingdom and Europe.

The pace of acquisitions accelerated beginning in 2020. Entry into the United States market came through three acquisitions: Allied (Texas), One Stop (Alabama and Florida), and IntraCoastal (Florida and Georgia). These transactions expanded its U.S. presence across the Gulf Coast and Southeastern United States. UBS analysts would later note that the company completed over 70 acquisitions between 2020 and 2022, and said the pace exposed weaknesses in its balance sheet and internal controls.

The Witt O'Brien's acquisition. The October 2022 acquisition of Witt O'Brien's, LLC from SEACOR Holdings added a crisis and emergency management firm headquartered in Houston, Texas, with approximately 45 locations across several countries. The acquisition expanded Ambipar's client base to over 11,000 clients across six continents. CEO Guilherme Borlenghi described the transaction as "transformational" and emphasized the complementary nature of both organizations' cultures and business models. Stout served as financial advisor to Ambipar on the deal.

De-SPAC transaction with HPX Corp. Parallel to its acquisition strategy, the company pursued access to U.S. public capital markets. On July 6, 2022, Emergencia Participacoes S.A. entered into a definitive business combination agreement with HPX Corp., a special purpose acquisition company trading on the New York Stock Exchange. The transaction valued Ambipar Response at an implied $581 million enterprise value, with pro forma equity value of approximately $798 million assuming no redemptions. The deal was expected to deliver at least $168 million in gross proceeds, with committed PIPE subscriptions from institutional investors including Opportunity, Constellation, XP, and the Ambipar Group itself. Post-closing, the Ambipar Group retained approximately 50% equity stake in the newly public entity.

Global Operations and Market Position

By the time of its chapter 11 filing, Ambipar Emergency Response reported presence in 40 countries with more than 500 operational bases. The workforce exceeded 20,000 employees, with more than 1,200 response personnel deployed across North and South America, Africa, Europe, and Antarctica.

The company reported more than 217 service centers in 16 countries. The customer portfolio exceeded 10,000 accounts spanning logistics, chemical, oil and gas, mining, and industrial sectors.

The company operated five training camps across four countries, training more than 38,000 people annually in emergency response protocols, hazardous materials handling, and crisis management procedures.

Environmental response services market dynamics. The environmental response systems market stood at $12.34 billion in 2024 and is projected to reach $25.67 billion by 2033, representing compound annual growth of 8.5% from 2026 through 2033. North America led the market with approximately 35% share in 2023, while Asia Pacific emerged as the fastest-growing region. The market encompasses technologies and services designed to mitigate environmental emergencies including hazardous waste spills, oil leaks, and industrial pollution events.

Derivatives Issues and Parent Company Proceedings

The chapter 11 filing followed developments at its Brazilian parent company. In September 2025, former chief financial officer Joao de Arruda resigned after serving just over a year in the role. Reuters reported that during his tenure, swap contracts were transferred from Bank of America to Deutsche Bank and later amended to include speculative elements.

The swap contract irregularities. The Brazilian bankruptcy filing cited the "discovery of evidence of irregularities in the contracting of swap operations by the Finance Department."

The parent company hired FTI Consulting to conduct a forensic accounting review of the derivative transactions and related financial activities. A criminal inquiry was opened to examine the former CFO's conduct.

Green bond exposure. In February 2024, Ambipar made what was described as the largest green bond issuance by a Brazilian private company: $750 million maturing in 2031 at 9.875% per annum. The company returned to the market in February 2025 with a $400 million green notes offering at 10.875% maturing in 2033, with Simpson Thacher & Bartlett serving as lead counsel. The combined outstanding green bond obligations totaled approximately $1.05 billion, with Bank of New York Mellon acting as indenture trustee.

Court filings allege the second tranche of Green Notes—$128 million in proceeds—did not reach Ambipar Emergency Response despite requirements that the funds should have flowed to the subsidiary.

Governance and market response. On October 16, 2025, Brazil's B3 stock exchange removed Ambipar from all indices citing governance concerns.

In the U.S., NYSE American commenced delisting proceedings on October 22, 2025 after determining the company was no longer suitable for listing pursuant to the NYSE American Company Guide. The decision followed the company's disclosure of its chapter 11 filing the previous day. When trading resumed on October 23, 2025, AMBI shares fell 31% to 77 cents.

The company chose not to fight the delisting determination. On October 28, 2025, NYSE American suspended trading after Ambipar confirmed it would not exercise its right to request a review. Shares had fallen nearly 96% year-to-date.

Why the Company Filed for Bankruptcy

The Ambipar Emergency Response chapter 11 filing involves a debtor that reported approximately $1.07 billion in assets and $328 million in liabilities alongside guarantees and intercompany transactions tied to its parent company.

The guarantee exposure. Ambipar Emergency Response had guaranteed approximately $328 million in green notes principal issued by Ambipar TopCo—the parent company. With Bank of New York Mellon serving as indenture trustee, these guarantee obligations created direct creditor claims against the debtor despite its asset base.

Pre-petition cash sweep allegations. Creditors raised concerns that pre-petition cash sweeps had moved substantially all cash from the debtor and its subsidiaries to Ambipar TopCo. The Special Committee appointed to handle conflict matters is tasked with investigating these transfers and whether the debtor received reasonably equivalent value.

Contribution and indemnification claims. Beyond the direct guarantee exposure, the debtor faces contribution claims arising from its guarantees of affiliate debt. Payments on the guarantees would create contribution claims against the parent company and other co-guarantors. The parent company and other guarantors are in Brazilian restructuring proceedings.

De-SPAC transaction scrutiny. The 2022 de-SPAC with HPX Corp. is among the transactions referenced in objections to Simpson Thacher's retention because the firm advised on the deal.

Substantive consolidation risk. Substantive consolidation has been raised as an issue in the Brazilian recuperacao judicial proceedings involving the broader Ambipar Group.

Parallel Restructuring Proceedings

The Ambipar restructuring includes parallel proceedings in Brazil and the United States.

The Brazilian bankruptcy filing disclosed total debt of 10.48 billion reais, approximately $1.94 billion at prevailing exchange rates. The recuperacao judicial proceedings encompassed 72 entities including the parent company and its affiliates.

Pre-petition injunctive relief. Even before the October 20 filing, Ambipar Participacoes had secured interim relief on September 24, 2025, initiating court-supervised insolvency proceedings. The injunction expressly covered subsidiaries including Ambipar Emergency Response, temporarily staying creditor actions and enforcement measures.

The "Response" versus "ESG" segments. Within the Ambipar corporate family, two segments are described in filings: the "Response" segment (the emergency response business housed under Ambipar Emergency Response) and the "ESG" or environmental services segment focused on long-term waste management contracts. The chapter 11 filing noted that the debtor's distress stemmed from its parent's problems rather than its own operational challenges.

Funding Agreement and Professional Conflicts

Without traditional DIP financing, the Ambipar Emergency Response case relies on a parent-company funding arrangement that raised creditor objections before court approval.

Parent Company Funding Structure.

The funding structure provides up to $3 million with no interest or repayment obligation. The Funding Agreement Motion cited allegations that pre-petition cash sweeps transferred the debtor's cash to the parent company.

Deutsche Bank filed a limited objection to the funding agreement, raising concerns about the lack of explanation for why the debtor lacked adequate funds and questioning the funding structure's controls. The court approved the arrangement on December 19, 2025.

Simpson Thacher Conflicts Objection.

The retention of Simpson Thacher & Bartlett as lead bankruptcy counsel generated a contested matter in the case's early stages. Minority shareholder Opportunity Dinamico Fundo de Investimento em Participacoes Multiestrategia, holding 21% or more of the debtor's equity, filed an objection to the retention.

The conflict allegations. Opportunity's objection identified multiple bases for concern about Simpson Thacher's dual representation:

• Simpson Thacher simultaneously represented the entire Ambipar Group—including Ambipar TopCo—in the Brazilian recuperacao judicial proceedings
• Simpson Thacher had advised on the Green Notes issuances and de-SPAC transaction referenced in the objection
• Simpson Thacher allegedly took no action to prevent pre-petition cash sweeps that transferred debtor funds to the parent company
• Prepetition invoices for debtor legal work had been paid by Ambipar TopCo rather than the debtor itself

Opportunity argued that these conflicts "cannot be cured by Special Committee structure."

Resolution through Special Committee structure. Despite the objections, the court approved Simpson Thacher's retention on December 19, 2025, subject to a Special Committee arrangement. The Simpson Thacher Retention Order established Quinn Emanuel Urquhart & Sullivan as counsel to an Independent Special Committee charged with investigating and handling "Conflict Matters"—those issues where Simpson Thacher's conflicts precluded it from representing the debtor's interests. Quinn Emanuel handles conflict matters, including claims against the parent company, related parties, and professionals who advised on pre-petition transactions.

Key Case Timeline

Professional Retentions and Key Parties

The case includes multiple professional advisors.

Debtor Professionals.

Other Key Parties.

Simpson Thacher represents the debtor, Davis Polk and Haynes and Boone represent noteholders, and Skadden represents minority shareholders. The Special Committee structure assigns conflict matters to Quinn Emanuel.

Intercompany Issues and Related Party Concerns

The Ambipar chapter 11 case includes several intercompany issues:

Cash sweep investigation. The Debtor's Omnibus Reply stated that pre-petition cash sweeps allegedly moved substantially all cash from the debtor and its subsidiaries to Ambipar TopCo. The Special Committee is investigating these transfers and whether the debtor received reasonably equivalent value.

Green Notes proceeds discrepancy. Court filings allege the $128 million in Green Notes proceeds did not reach the debtor despite contractual requirements.

Contribution claims. To the extent the debtor makes payments on its guarantees of the Green Notes, it obtains contribution claims against co-obligors. The parent company and other guarantors are in their own restructuring proceedings in Brazil.

De-SPAC transaction. The 2022 de-SPAC transaction is referenced in objections to Simpson Thacher's retention because the firm advised on the deal.

Substantive consolidation. The Brazilian restructuring encompasses 72 entities with intertwined operations and intercompany relationships, and substantive consolidation has been raised as an issue in those proceedings.

Frequently Asked Questions

What is Ambipar Emergency Response and why did it file for chapter 11 bankruptcy?

Ambipar Emergency Response is the Cayman Islands-based holding company for an emergency response and crisis management business operating in 40 countries with over 20,000 employees and more than 500 operational bases. The company filed for chapter 11 protection on October 20, 2025, reporting approximately $1.07 billion in assets and $328 million in liabilities. The filing followed the parent company's Brazilian recuperacao judicial proceedings citing irregularities in swap operations, and the debtor had guaranteed approximately $328 million in green notes issued by the parent.

What caused the parent company's financial distress?

The parent company, Ambipar Participacoes e Empreendimentos S.A., cited irregularities in derivative swap transactions. The former chief financial officer allegedly transferred swap contracts from Bank of America to Deutsche Bank during his tenure and amended them to include speculative elements. When these irregularities were discovered in September 2025, the CFO resigned, and the parent company ultimately declared total debt of 10.48 billion reais ($1.94 billion) in Brazilian recuperacao judicial proceedings. The forensic accounting review conducted by FTI Consulting and a criminal inquiry continue to examine the transactions.

What are the parallel Brazilian proceedings and how do they relate to the U.S. case?

On the same day as the U.S. chapter 11 filing, Ambipar Participacoes and 71 affiliates initiated recuperacao judicial proceedings in the Third Business Court of Rio de Janeiro. The Brazilian proceedings encompass the parent company, the ESG (environmental services) segment, and numerous affiliates. The U.S. chapter 11 case runs parallel to these proceedings, and substantive consolidation has been raised as an issue in the Brazilian proceedings.

What is the green notes guarantee exposure?

Ambipar Emergency Response guaranteed approximately $328 million in principal on green notes issued by its parent company. These notes were issued in two tranches: a $750 million issuance in February 2024 at 9.875% maturing in 2031, and a $400 million issuance in February 2025 at 10.875% maturing in 2033. Bank of New York Mellon serves as indenture trustee. Court filings allege $128 million in proceeds from the second tranche did not reach the debtor despite contractual requirements.

What was the conflict of interest objection regarding Simpson Thacher?

Minority shareholder Opportunity Dinamico, holding 21% or more of the debtor's equity, objected to the retention of Simpson Thacher & Bartlett as lead bankruptcy counsel. The objection noted that Simpson Thacher simultaneously represents the entire Ambipar Group in Brazilian restructuring proceedings, advised on the Green Notes issuances and de-SPAC transaction referenced in the objection, allegedly failed to prevent pre-petition cash sweeps, and had its pre-petition debtor invoices paid by the parent company. The court ultimately approved the retention with a Special Committee structure: Quinn Emanuel Urquhart & Sullivan was appointed to investigate and handle "Conflict Matters" involving claims against the parent, affiliates, and transaction parties.

How is the chapter 11 case being funded?

Rather than traditional DIP financing, Ambipar's parent company provides up to $3 million to fund case administration. This funding carries no interest and no repayment obligation, and the parent company characterizes it as a non-loan. The motion cited allegations that pre-petition cash sweeps had moved the debtor's cash to the parent. Deutsche Bank filed a limited objection questioning the funding structure, but the court approved the arrangement on December 19, 2025.

What happened to the company's stock price?

The company's NYSE American-listed shares (AMBI) declined. Shares fell 31% to 77 cents when trading resumed after a two-day halt following the bankruptcy filing disclosure. Year-to-date losses reached approximately 96%. The NYSE American commenced delisting proceedings on October 22, 2025, and suspended trading on October 28, 2025 after the company confirmed it would not contest the delisting. Similarly, Brazil's B3 exchange removed Ambipar from all indices on October 16, 2025, citing governance concerns.

What was the Witt O'Brien's acquisition?

In October 2022, Ambipar acquired Witt O'Brien's, LLC from SEACOR Holdings, adding a crisis and emergency management firm headquartered in Houston with approximately 45 locations across multiple countries. CEO Guilherme Borlenghi described the transaction as "transformational." The acquisition expanded Ambipar's client base to over 11,000 accounts across six continents. The Witt O'Brien's deal was part of an M&A campaign of 70+ acquisitions between 2020-2022 that UBS analysts noted exposed weaknesses in the company's balance sheet and internal controls.

What are the pre-petition cash sweep allegations?

Creditors and the Special Committee are investigating allegations that pre-petition cash sweeps moved substantially all cash from Ambipar Emergency Response and its subsidiaries to the parent company, Ambipar TopCo.

What is the current case status and what comes next?

As of late December 2025, the case remains in early stages with no chapter 11 plan filed. The Funding Agreement and professional retentions have been approved, including the Special Committee structure with Quinn Emanuel investigating Conflict Matters.

Who is the claims agent for Ambipar Emergency Response?

Kurtzman Carson Consultants (operating as Verita Global) serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.

Read more chapter 11 case research on the ElevenFlo blog.