July 20, 2018 / 7:53 PM / in a month

UPDATE 2-Andrade Gutierrez proposes $345 mln debt restructuring

(Adds proposal to restructure debt, background)

SAO PAULO, July 20 (Reuters) - A unit of Brazilian engineering group Andrade Gutierrez, among the companies targeted by Brazil’s widest ever corruption probe, has proposed a restructuring of $344.7 million in bonds, the company said on Friday.

Andrade Gutierrez offered on Thursday to exchange unpaid bonds due last April for new bonds due on 2021, it said in a statement. The offer is valid through August 15. Bondholders may receive part of its credit in cash.

The new bonds will pay 11 percent yield, above the 4 percent in the unpaid bonds. One person with knowledge of the matter said investment bank PJT Partners is advising Andrade’s bondholders.

Brazil’s “Operation Car Wash” investigation into political kickbacks on state infrastructure contracts has cut credit access for conglomerates under probe, such as Andrade Gutierrez, and forced large engineering conglomerates to sell assets.

Andrade Gutierrez’s stake in toll road operator CCR SA will be part of the collateral offered in the debt exchange, AG said. To be completed, the offer must be accepted by 95 percent of bondholders.

The company earlier denied a Friday report in Brazilian newspaper Valor Econômico that the company would sell its stake in CCR. (Reporting by Tatiana Bautzer; Editing by Bernadette Baum Editing by Susan Thomas, Bernadette Baum and Richard Chang)

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