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Brazil's Braskem faces stock market suspension
July 5, 2017 / 3:41 PM / 5 months ago

Brazil's Braskem faces stock market suspension

SAO PAULO, July 5 (Reuters) - Brazilian petrochemical company Braskem may be suspended from Level 1 trading at the São Paulo Stock Exchange after failing to submit certain financial statements within a deadline, stock market operator B3 told Reuters in an emailed statement on Wednesday.

Braskem, whose stock market quotes are being given separately as a result of the delay, has until June 22 to formally present a defense.

“The case will be ruled on this week and could result in the suspension of the company,” the bourse said. If the problem persists, at the end of the process Braskem may be compulsorily delisted from Level 1 trading, the bourse said.

Level 1 trading requires companies to maintain a free-float of at least 25 percent of capital. The deadline to cure delays in the submission of financial statements is 30 days, B3 said.

Braskem did not immediately reply to an email seeking comment on a report on Wednesday in the newspaper Valor Economico, which said a ruling on the suspension would be made this week.

The newspaper said that until now Braskem had only submitted unaudited statements for the first quarter, the fourth quarter of 2016 and the full 2016 result.

According to Valor, Braskem said the delay was due to a pending analysis by independent auditors related to internal controls and procedures after the company signed plea deals with federal prosecutors in Brazil, the United States and Switzerland in connection with a massive graft scheme known as Operation Car Wash.

Brazil-based construction firm Odebrecht SA and Braskem agreed to pay at least $3.5 billion in the leniency deal it signed to resolve some international charges involving payoffs to former executives at Brazil’s state-controlled Petroleo Brasileiro SA, politicians and others.

Braskem is jointly owned by Odebrecht and Petroleo Brasileiro.

The decision to suspend the company from Level 1 trading could come as early as this week, Valor reported.

Braskem’s shares rose 1.48 percent in midmorning trading at the São Paulo Stock Exchange to 34.86 reais. (Reporting by Ana Mano; Editing by Jonathan Oatis)

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