Samarco is repaying those who gave him credit for fighting the Brazilian war

Samarco, a steel producer responsible for dangerous natural disasters in Brazil, has accused his creditors of being a “bad test” to disrupt the restructuring of the mine, which he says protects thousands of jobs.

Criticism from Samarco, an agreement between Vale’s international mining groups and BHP, comes after lawyers for the lenders’ group, including London treasurer Ashmore and US Canyon Partners, said this week that the reform was ” meaningless “.

Under the scheme, Samarco has granted bond holders and other lenders the opportunity to repay only 15% of the value in 2041, or they can convert the loan into a business. Debtors owe $ 22bn ($ 4.3bn).

The battle between Samarco and his creditors comes more than five years after the incident breaking the blood of Fundão tailings at the Germano mine site, which killed 19 people and destroyed one of Brazil’s largest rivers and sewers.

Affected by nearly $ 10bn on loan, Samarco earlier this year filed a lawsuit Revision cases, a court-ordered procedure in Brazil similar to bankruptcy protection.

The group of creditors, which includes Solus Alternative Management Asset Management, says the plan seeks to protect BHP and Vale from the consequences of the November 2015 disaster. Debtors are heavily indebted to Samarco.

Debtors’ lawyers, who own bonds and export fines, have rejected an application to cut 85% of their hair on their loans as “nonsense”, according to a document filed this week in Minas Gerais state court, where Samarco he lives.

In court letters, he also accused Vale and BHP of misusing their position to take advantage of debtors, claiming that all parties to the deal should receive everything from Samarco once they have repaid some of their debts.

About half of Samarco’s debts are in debt to Vale and BHP, which can receive the same discount and repayment.

Responding to the court, Samarco said: “This is another pathetic move from debtors to disrupt court reform and disrupt public opinion.” The company insisted it was ready to negotiate “despite the many disputes and accusations” with its authors.

“The plan was based on the size of the company’s revenue” and was aimed at keeping more than 6,000 direct and non-tax-related jobs, it added.

Mr Samarco said the registration of the changes to which the court-ordered administration should be avoided is to those who borrow money that could affect how they spend and pay in Renova, a foundation set up to oversee the reinstatement once settled by the opposition in Brazil.

Samarco alone resumed production in December and the result is expected to be less than one-third before the pool is damaged. However, the group is selling its metals in a thriving market.

Metal jewelry prices have become very popular this year, which helped Samarco-owned companies recover their price. It sells for about 80 cents per dollar, up from a low of 40 cents in early 2020 when the epidemic broke out.

The deputy president of law and order at BHP Brasil, Ivan Apsan, described Samarco’s statement as “fair and clear”.

“[They] give the best answer that can help Samarco to do so. . . keep working, and donate to Minas Gerais and Espírito Santo and donate to the Renova Foundation, “he said.

Vale expressed support for the restructuring process, which he described as “built according to the company’s capabilities”.

Ashmore and Canyon Partners declined to comment. Solus did not respond to a request for comment.