Braskem Wins Extended Chapter 15 Stay for R$55B Debt

Braskem S.A. and five affiliated financing entities filed a Chapter 15 petition in the U.S. Bankruptcy Court for the Southern District of New York on June 26, 2026 (case 26-11522), asking Judge Michael E. Wiles to recognize a court-supervised mediation the Brazilian petrochemical producer opened two days earlier in São Paulo. Foreign representative Antonio Reinaldo Rabelo Filho is seeking recognition of the São Paulo proceeding as Braskem's foreign main proceeding, or as a foreign nonmain proceeding for the debtors other than Braskem S.A. itself.

The filing followed rejected investor proposals and stalled out-of-court debt talks; Bloomberg reported the emergency-protection request as the company pursued a consensual capital-structure solution. Braskem moved to freeze creditor collection efforts on more than $342 million the company held in U.S. bank accounts while the Brazilian mediation proceeds. The court granted that provisional protection on June 30. As the mediation's injunction period neared its August 25 expiration, the debtors converted the underlying Brazilian process into an extrajudicial reorganization, and Judge Wiles extended the U.S. stay to match it that same day. The foreign representative has since proposed a recognition-hearing schedule running to a December 8 hearing.

Debtor(s)	Braskem S.A. (6 jointly administered entities)
Court	U.S. Bankruptcy Court, Southern District of New York
Case Number	26-11522
Petition Date	June 26, 2026
Judge	Hon. Michael E. Wiles
Foreign Proceeding	Brazilian Mediation, 2nd Bankruptcy and Reorganization Division, São Paulo State Court of Justice, Case No. 4113246-86.2026.8.26.0100
Foreign Representative	Antonio Reinaldo Rabelo Filho

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Braskem Wins Extended Chapter 15 Stay for R$55B Debt

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Brazilian Mediation Seeks Foreign Main Recognition for Six Debtors

The amended verified petition for recognition names Braskem S.A., Braskem Netherlands B.V., Braskem Netherlands Inc., B.V., Braskem Netherlands Finance B.V., Braskem Trading & Shipping B.V., and Braskem America Finance Company as debtors. It describes the Brazilian Mediation as a jointly administered protective-injunction and court-supervised interim mediation proceeding that began June 24, 2026 in the 2nd Bankruptcy and Reorganization Division of the São Paulo State Court of Justice. Braskem is asking the SDNY court to recognize that proceeding as a foreign main proceeding for all six debtors, or, in the alternative, as a foreign nonmain proceeding for every debtor except the Brazilian parent.

Braskem America Finance Company — referred to in the docket as U.S. FinCo — is the only debtor organized to raise financing directly in the United States, a structural detail that later becomes the center of a creditor dispute over whether Chapter 15 is even the right vehicle for that entity.

Petrochemical Downturn, Maceió Costs and Feedstock Pressure Cited as Causes

The amended petition attributes Braskem's liquidity crisis to a combination of forces: a global petrochemical downturn that compressed margins and utilization, ongoing liabilities tied to geological subsidence remediation in Maceió, Alagoas — ground movement that Brazilian federal police formally attributed to Braskem in a 2024 investigation — and higher feedstock and operating costs linked to Middle East geopolitical tensions affecting naphtha supply.

The petition also details an immediate liquidity crunch: as of June 2026, more than R$2.6 billion (US$499 million) in obligations had come due for Braskem S.A. alone, including roughly R$750 million ($144 million) in interest owed to noteholders, R$1.3 billion ($249 million) in maturing letters of credit, and R$450 million ($87 million) in real-denominated debt maturities. The filing warns that non-payment could trigger cross-acceleration of the Braskem Group's entire R$54 billion (roughly $10.3 billion) in financial debt.

Eight Dollar Note Series and a Maturing Revolving Facility Anchor the Debt Stack

Braskem's consolidated gross debt totaled approximately R$55 billion (about $11 billion) as of June 19, 2026, according to the amended petition. The bulk of that is spread across eight series of dollar-denominated notes issued mainly through Braskem Netherlands Finance B.V., with one series issued through Braskem America Finance Company:

Issuer	Coupon	Maturity	Principal Outstanding
Braskem Netherlands Finance B.V.	4.50%	2028	US$1.2 billion
Braskem Netherlands Finance B.V.	4.5%	2030	US$1.5 billion
Braskem Netherlands Finance B.V.	8.5%	2031	US$882 million
Braskem Netherlands Finance B.V.	7.25%	2033	US$1.0 billion
Braskem Netherlands Finance B.V.	8%	2034	US$862 million
Braskem America Finance Company	7.125%	2041	US$582 million
Braskem Netherlands Finance B.V.	5.875%	2050	US$767 million
Braskem Netherlands Finance B.V.	8.5%	2081	US$251 million

Beyond the notes, Braskem Netherlands and non-debtor Braskem America Inc. jointly borrow under a $1 billion unsecured revolving credit facility entered in December 2021 with a five-year maturity, putting it on track to come due within months of the petition. Braskem Trading & Shipping carries $1.3 billion in letters of credit, split between roughly $973 million committed and $338 million uncommitted, and Braskem S.A. separately owes about $100 million on Brazilian agricultural-linked Cédula de Produto Rural instruments.

Provisional Stay Shields U.S. Accounts After Safra's Collection Push

Braskem's motion for provisional relief asked the court to apply the Bankruptcy Code's automatic stay to the debtors and their U.S. property pending a recognition ruling, citing more than $342 million held in U.S. accounts as of June 22, 2026 that the company wanted shielded from unilateral creditor action — including an attempt by Banco Safra to accelerate and collect on a $66.8 million facility around the time of the filing.

The court granted that request on June 30. The order applies Section 362's stay to the debtors and their U.S. property to the extent of the Brazilian court's initial order, and applies Section 363 specifically to U.S. FinCo's assets. Creditors may still send notices of default or acceleration, but the order bars collection, enforcement, or realization on the underlying debt. The relief is explicitly not a final recognition ruling and expires at the earlier of a U.S. recognition decision or termination of the Brazilian stay.

New IG4-Petrobras Leadership and Failed Standstill Talks

The petition arrives roughly three months after Braskem's ownership changed hands. IG4 Capital's Shine I vehicle and Petrobras were confirmed in June as co-controllers of Braskem, concluding an April 2026 deal that transferred control from prior shareholder Novonor. Under the new governance framework, Shine I holds 50.1% of voting shares and Petrobras holds 47%, with the board chaired by Petrobras chief executive Magda Chambriard. The ownership change brought a new executive team led by chief executive Hélcio Tokeshi, who told Valor International in early June that the restructuring would not be easy but that current market timing worked in the company's favor, pointing to operational as well as balance-sheet changes as part of the plan.

Braskem named an almost entirely new leadership team alongside Tokeshi: Carlos Brandão, an IG4 partner and former CFO of Oi, as chief financial officer; Camilla Tápias as vice president of legal and institutional relations; Carlos Plachta, a former independent Braskem board member, as global vice president of logistics, trading and market; and Luiz Rossato as vice president of transformation. Márcio Pitzer, who continues as vice president of compliance and auditing, is one of the executives who remained from the prior team.

Before the Brazilian filing, Braskem had been pursuing a consensual, out-of-court path. Sources close to the controlling shareholders told Valor International there was no intention of seeking court-supervised bankruptcy protection, though they cautioned that any acceleration of debt repayments by creditors could force the company to adopt more drastic measures. The stated goal was to restructure nearly R$60 billion in debt, including liabilities linked to Mexican subsidiary Braskem Idesa, which was already negotiating with bondholders and joint-venture partner Inbursa. Tokeshi said the company wanted to avoid making approximately $150 million in interest payments, along with a portion of principal due in July. On June 24, Braskem was reported to be preparing to seek a protective injunction against creditor claims, the step that preceded the court-supervised mediation.

Talks with investors broke down in the days before the petition. Braskem and a group of investors exchanged competing restructuring proposals during June 2026, including a June 11 in-person meeting and subsequent investor terms delivered on June 19, which Braskem rejected as unacceptable. The company said it shared non-public information with certain holders and managers of its senior securities and debentures under confidentiality agreements signed June 11, and that it aimed to keep negotiating a consensual restructuring, potentially under Brazil's extrajudicial reorganization regime.

Noteholders Dispute Chapter 15 Treatment of the U.S. Financing Unit

Two creditor groups filed statements declining to object to the interim U.S. stay while reserving broader rights. An ad hoc group holding more than $4.7 billion in principal amount of Braskem's funded debt — represented by Davis Polk & Wardwell — did not object to the interim stay so negotiations could continue, but reserved the right to seek changes to the stay, pursue discovery, and contest recognition or further relief.

FFI Fund Ltd., FYI Ltd., and Olifant Fund, Ltd., holders of Braskem America Finance Company's 7.125% notes due 2041, took a narrower but more pointed position through counsel Paul Hastings. Their statement reserved specific challenges to the petition's disclosures, to recognition of the Brazilian process as it applies to U.S. FinCo, to U.S. FinCo's center of main interests or establishment, and to whether Chapter 15 — rather than a plenary Chapter 11 case — is the appropriate vehicle for that entity at all.

On July 29, The Bank of New York Mellon appeared through Reed Smith as indenture trustee for nine identified Braskem note series, adding an 8.627% series due 2045 to the eight series already detailed in the amended petition alongside the 7.125% notes due 2041, the 4.500% notes due 2028 and 2030, the 5.875% notes due 2050, the subordinated resettable fixed-rate notes due 2081, the 7.250% notes due 2033, the 8.500% notes due 2031, and the 8.000% notes due 2034. The filing is an appearance and request for service of papers, not an objection or a stated merits position.

On August 11, the foreign representative gave notice that he and FFI Fund Ltd., FYI Ltd., and Olifant Fund, Ltd. had stipulated to a proposed confidentiality agreement and protective order covering discovery material sought in connection with the amended recognition petition and related disputes, including informal requests, Rule 2004 notices or motions, and formal discovery requests. The proposed order provides for Confidential, Highly Confidential, and Advisors' Eyes Only designations; it was set for presentment on August 18, with objections due August 17.

On August 17, the FFI/FYI/Olifant group filed a status update ahead of the conference asserting that Braskem had not engaged with it in restructuring discussions and had not produced discovery material after the group served requests on July 6, despite subsequent responses and meet-and-confer discussions. The group said it intends to move to compel discovery and oppose any additional provisional relief at the status conference. The same filing states the debtors' position, conveyed in correspondence, that Braskem had negotiated with representatives of more than 65% of the company's financial debt. Those are competing party positions in a status update, and the docket does not yet reflect a ruling on either the discovery dispute or the scope of further provisional relief.

The foreign representative responded on August 18, saying the parties had agreed to a document-discovery schedule under which the noteholders served 16 production requests and 17 interrogatories, the debtors served responses and objections and produced what he described as a significant amount of material, and meet-and-confer discussions were continuing. He also framed the Brazilian Mediation as transitional, describing a consensual mediation plan, an extrajudicial reorganization, or a judicial reorganization in Brazil as the possible next phases. The Court held the scheduled status conference that same day.

On August 19, the Court entered the stipulated confidentiality agreement and protective order along with a related ESI-production protocol between the foreign representative and the FFI/FYI/Olifant group. The protective order permits Confidential, Highly Confidential, and Advisors' Eyes Only designations but states it does not itself entitle a party to discovery; the ESI order requires cooperation on identifying, preserving, collecting, reviewing, and producing electronic material while leaving the scope of collection to further meet-and-confer. Neither order resolves the recognition dispute or the parties' underlying disagreement over Braskem's engagement, and the next status conference was set for August 25 before Judge Wiles.

Mediation Gives Way to Brazilian EJ Proceeding

The Brazilian Mediation's 60-day injunction period was set to expire August 25, 2026. Ahead of that deadline, the debtors commenced a Brazilian recuperação extrajudicial proceeding, filing an EJ petition and a restructuring plan — the EJ Plan — with the São Paulo court on August 24. The foreign representative told the SDNY court the EJ filing "immediately follows and effectively supplants" the mediation.

Filing an EJ petition with support from at least one-third of affected creditors triggers an automatic stay of creditor actions under Brazilian law, ordinarily lasting 180 days but reduced here by the length of the prior mediation injunction. The EJ Plan already has the backing of creditors holding 39.6% of the debtors' total indebtedness subject to the plan; the debtors said they intend to spend the coming weeks seeking support from creditors holding at least 50.1% in amount of each affected class, the threshold needed for the Brazilian court to confirm the plan.

The same day, the foreign representative asked Judge Wiles to extend the June 30 provisional-relief order through the court's eventual ruling on recognition, tying the Section 362 stay to the Brazilian court's order accepting the EJ Plan rather than to the mediation order. The motion describes the proposed extension order as substantially identical to the original and says it incorporates language previously negotiated with the ad hoc group's advisors, counsel to the 2041 noteholders, and the U.S. Trustee. It also discloses that the debtors' combined U.S. bank account balances had fallen to more than $222 million as of August 20, down from the more than $342 million reported when the case was filed in June.

The motion argues extension is warranted in part because certain creditors "have expressly stated that they intend to challenge the extension of provisional relief," and it cites a string of SDNY decisions recognizing Brazilian EJ proceedings as foreign proceedings, including the court's recognition of Raízen S.A.'s EJ proceeding in April 2026. Judge Wiles heard argument on the extension motion on August 25 at 2 p.m. in Courtroom 617, after the foreign representative separately moved to shorten notice for the hearing.

The Court entered an order extending provisional relief that same day. The order applies Section 362's stay to each debtor and its U.S. property to the same extent as the stay initiated by the EJ Plan filing and potentially ratified by the Brazilian court's EJ acceptance order, and applies Section 363 to U.S. FinCo's assets; it also states that any later modification of the Brazilian order will not alter the U.S. stay without a further order of the Court. Judge Wiles found a substantial likelihood of recognition on the pleadings then on file, a material risk of irreparable harm absent relief, and that the balance of harms favored preserving the status quo. The relief took effect immediately and remains in force until the Court makes a final recognition determination; it is not itself a recognition ruling, and creditors' rights to object to recognition remain reserved.

On August 26, the foreign representative noticed a proposed recognition-hearing management and scheduling order, describing it as agreed with the FFI/FYI/Olifant Funds, the ad hoc group of noteholders, and a steering group of lenders. The proposed schedule sets a September 3 deadline for parties opposing recognition to elect discovery, September 9 for written discovery requests, October 9 for completion of production, November 9 for completion of fact discovery, November 20 for oppositions, December 3 for replies, a December 7 pretrial conference, and a December 8 recognition hearing. Objections to the proposed order itself are due August 27, with presentment set for August 28; until the Court enters the order, those dates remain proposed rather than court-ordered.

Key Timeline

The case moved from a change of control to a Chapter 15 filing and provisional stay in under a month. By August 24, the Brazilian mediation had converted into an EJ proceeding, and the debtors won an extension of the U.S. stay on August 25 alongside the ongoing discovery dispute between the foreign representative and the FFI/FYI/Olifant group. The foreign representative has since proposed a recognition-hearing schedule running to a December 8 hearing.

Date	Event
June 3-4, 2026	IG4 and Petrobras confirmed as Braskem's co-controllers, replacing Novonor
June 9, 2026	New CEO Hélcio Tokeshi discusses restructuring plans publicly
June 24, 2026	Brazilian Mediation commences in São Paulo state court
June 25-26, 2026	Emergency filing reported after rejected investor proposal and stalled debt talks
June 26, 2026	Chapter 15 petition and provisional relief motion filed in SDNY (case 26-11522)
June 30, 2026	Court enters Order Granting Provisional Relief
July 29, 2026	Bank of New York Mellon appears as indenture trustee for nine identified note series
August 11, 2026	Foreign representative and FFI/FYI/Olifant noteholder group notice a proposed stipulated confidentiality agreement and protective order
August 17, 2026	FFI/FYI/Olifant group files status update disputing Braskem's engagement and discovery production, signaling intent to move to compel and oppose further provisional relief
August 18, 2026	Foreign representative responds to status update; Court holds scheduled status conference
August 19, 2026	Court enters stipulated confidentiality/protective order and joint ESI-production protocol
August 24, 2026	Debtors commence Brazilian EJ proceeding with 39.6% creditor support, superseding the mediation
August 24, 2026	Foreign representative moves to extend U.S. provisional relief and to shorten notice for a hearing
August 25, 2026	Court hears argument and enters order extending provisional relief through the final recognition determination
August 26, 2026	Foreign representative notices proposed recognition-hearing schedule running to a December 8 hearing

Frequently Asked Questions

What is Braskem asking the U.S. court to do?

Braskem is seeking Chapter 15 recognition of the Brazilian Mediation — a court-supervised proceeding pending in São Paulo — as its foreign main proceeding, so that U.S. courts will honor the Brazilian stay and protect the company's U.S. assets while it negotiates with creditors.

What did the June 30 provisional relief order do?

It applied the Bankruptcy Code's automatic stay to the debtors and their U.S. property, to the extent of the Brazilian court's initial order, and separately protected Braskem America Finance Company's assets under Section 363. It is temporary and not a final recognition ruling.

Why are some noteholders disputing Chapter 15 treatment of Braskem America Finance Company?

Holders of the 7.125% notes due 2041 argue that U.S. FinCo — the debtor that borrows directly in the United States — may not have its center of main interests or establishment in Brazil, and they have reserved the right to argue that a Chapter 11 case, not Chapter 15 recognition, is the appropriate proceeding for that entity.

What happened at the August 18 status conference, and what comes next?

The court held the scheduled conference after the foreign representative responded to the FFI/FYI/Olifant group's status update, describing an agreed document-discovery schedule and ongoing meet-and-confer sessions. On August 24, the Brazilian mediation converted into an EJ proceeding and the foreign representative asked the court to extend the U.S. provisional stay to match it. Judge Wiles heard that motion and entered an order extending the stay on August 25, and the foreign representative has since proposed a recognition-hearing schedule running to a December 8 hearing.

What is the Brazilian EJ proceeding, and how does it change the U.S. case?

Recuperação extrajudicial is a Brazilian court-supervised restructuring process the debtors commenced on August 24 after the mediation's 60-day injunction period lapsed, filing an EJ Plan alongside the petition. The plan already has the support of creditors holding 39.6% of the affected debt, and the debtors are seeking at least 50.1% support in each affected class to reach Brazilian court confirmation. In the U.S. case, the foreign representative asked the court to extend the provisional stay to track the new EJ proceeding rather than the mediation it replaced, and Judge Wiles granted that extension on August 25.

What did the entered discovery orders do?

On August 19, the court entered a stipulated confidentiality agreement and protective order alongside a joint ESI-production protocol between the foreign representative and the FFI/FYI/Olifant group. The orders set procedures for handling and designating discovery material and for exchanging electronic data; neither resolves the recognition dispute or the parties' disagreement over Braskem's engagement with the group.

Two other 2026 Chapter 15 cases followed a similar cross-border path: Raízen's R$98 billion Brazilian workout and Altice France's €24 billion restructuring.