Braskem planned to file for out-of-court restructuring this Thursday, June 25th. This date appears in documents the company had to make public as per a confidentiality agreement signed with its creditors (by contract, it was obligated to share information about the negotiations).

However, faced with a deadlock in negotiations, the petrochemical company resorted to an Urgent Precautionary Injunction filed with the 2nd Bankruptcy and Judicial Reorganization Court of São Paulo, a legal mechanism that temporarily suspends the payment of financial obligations while the company attempts to reach an agreement with creditors.

The precautionary measure was filed with a mechanism that allows the company to seek judicial protection before filing for out-of-court restructuring – a kind of Brazilian standstill , that is, a shield that prevents creditors from executing while negotiations continue.

Braskem also signaled that it may adopt "protective measures abroad," which points to a possible parallel process in the United States to protect its international assets.

But it is the documents that explain why Braskem failed to move forward with its RE (Recovery and Expenses) plan. Internally dubbed Project Catalyst, and advised by the Lazard bank, it reveals a negotiation that fell apart before reaching any conclusion.

There were three rounds of bids between the company and the Ad Hoc Group (AHG) of bondholders, which includes asset managers such as Capital Group and AllianceBernstein, as well as distressed funds such as Elliott Investment Management and Strategic Value Partners (SVP).

This committee, organized by the creditors with its own Steering Committee, ended without an agreement. Each side rejected the other's proposal. And the documents make it clear that the positions are, for now, irreconcilable.

According to sources consulted by NeoFeed , Braskem's proposal was "austere for a company asking for a favor."

The company wanted to extend all maturities by five years, reduce the coupon (interest) on the bonds by 2 percentage points, and have the option to pay 100% of the interest in PIK — that is, defer payment in cash and accumulate the debt — between July 2026 and December 2028.

"In exchange, he offered no new money, no collateral on assets, and refused any reduction in principal," the source said.

The AHG Steering Committee's response was direct, calling the proposal wholly unsatisfactory . Furthermore, it stated that including a coupon reduction in a corporate restructuring is "unheard of" and "calls into question the seriousness" with which Braskem conducted the negotiations – especially considering the level of sophistication of the advisors involved.

The creditors' position was opposed in almost every respect. Any concession in terms of time would need to be compensated with an increase – not a reduction – in the coupon rate.

The committee also demanded that Petrobras, as the controlling shareholder, participate directly in the negotiations and contribute with some type of burden-sharing .

And it imposed restrictions on the use of cash during the negotiation period, including a ban on using subsidized debt from BNDES to finance the Transforma Rio project while requesting relief from bondholders.

Braskem responded on Wednesday, June 24, one day before the planned date for filing the RE (Extraordinary Recovery), stating that the creditors' counterproposal was also unacceptable.

A cash register that disappears

What makes the impasse dangerous for the company is that Braskem's own documents show a delicate liquidity situation.

In its cash flow projections without restructuring, the company ends December 2026 with a negative free cash balance of US$821 million (more than R$4.2 billion).

This figure, which Braskem itself presented to creditors as an argument for the urgency of the negotiation, shows a tight schedule of obligations.

Total debt service is projected for the third quarter of 2026 to amount to US$878 million (approximately R$4.5 billion), including bond and debenture payments, bilateral debt, and letters of credit (LCs). The company has US$188 million (just under R$1 billion) to disburse in bond interest alone between July and September.

The total financial debt structure, which stood at US$9.5 billion in April 2026, is dominated by international dollar-denominated bonds, all with bullet maturities, meaning they do not amortize over time.

The 2028 Bond, with a maturity of US$1.19 billion and 4.5% annual interest, is the most urgent. The 2030 Bond, with a maturity of US$1.51 billion, comes next. Together, they represent almost US$2.7 billion maturing in the next four years—and whose semi-annual interest payments are already starting to put pressure on cash flow now.

There is also the $1 billion Revolving Credit Facility (RCF), maturing in December 2026. Importantly, this instrument represents a significant liquidity trigger, independent of any negotiations with bondholders.

The next step

With this impasse in negotiations, market sources told NeoFeed that they are working with two scenarios.

The first is a new round of negotiations, this time with Petrobras at the table – something AHG explicitly demanded as a condition for moving forward.

The state-owned company's participation, which controls Braskem jointly with the Novonor group, opens the possibility of shareholder support, either through guarantees or capital contributions. Without this, creditors have indicated that there is no basis for an agreement.

The second scenario – which bondholders are already pricing in – is a precautionary measure. Braskem will likely resort to this legal mechanism to temporarily suspend payments on its obligations while it attempts to reach an agreement.

The move would give the company an operational boost that it hasn't been able to get until now.