Peru

Peru’s currency and bonds tumbled Monday after an opinion poll showed leftist presidential candidate Pedro Castillo as the clear favorite ahead of June’s presidential runoff, Bloomberg News reported. The Peruvian sol turned in the worst-performance in the developing world. Castillo, whose party has praised Fidel Castro and Venezuela’s Hugo Chavez, is leading Keiko Fujimori by 11 percentage points, according to the survey by Ipsos Peru carried out between April 15 and 16. Fujimori is the polarizing right-wing daughter of a jailed former president.
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Two developments in the China Fishery Chapter 11 bankruptcy filing have given William Brandt, the trustee overseeing the sale of the company’s Peruvian assets, hope that he will get a deal done, Seafood Source reported. On 19 February, Brandt filed a proposed settlement agreement with China Fishery Group’s court-appointed liquidator, FTI Consulting, which had sued the company, arguing it had used ill-gotten earnings to purchase Copeinca in 2013.

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Latin American countries should quicken steps for airlines to renew domestic flights no later than July before more companies are forced to declare bankruptcy or close, a high-ranking official of the International Air Transport Association (IATA) said on Thursday, Reuters reported. The trade group estimated losses for airlines in Latin America at $4 billion this year, with total losses for the industry expected to reach $84 billion globally. Latin America has imposed stricter travel restrictions than most regions to fight coronavirus.

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Brazil construction company Odebrecht SA has taken Peru to arbitration over a failed $2 billion investment in a gas pipeline, arguing it needs to recoup the money to pay debtors in order to navigate its own bankruptcy restructuring, Reuters reported. Odebrecht, which announced the move on Wednesday, is in a precarious financial situation due to the revelation of its participation in a complex scheme to exchange bribes for public work contracts throughout Latin America. Peru’s prosecutorial agency did not return a request for comment on Wednesday.

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Bondholders of Odebrecht SA’s builder unit won’t see any of the money the troubled company is getting from a long-delayed sale in Peru, one person with direct knowledge of the matter said. Of the $1.4 billion price tag of the Chaglla hydroelectric plant in 2017, Odebrecht will likely get about $640 million, Bloomberg News reported. Half of that will go to pay damages to the Peruvian government, Justice Minister Vicente Zeballos said last week. Almost all the rest will go to creditors of the project itself, the person said, asking not to be named because the matter isn’t public.

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Pacific Andes group executives are disputing creditors' notion that the Peruvian insolvency proceedings for its fishmeal companies can block the New York court's access to those assets, Undercurrent News reported. In recent days, Pacific Andes International Holdings (PAIH) executive director, Jessie Ng, as well as representatives from its Peru-based China Fishery Group subsidiary and suppliers to the Peruvian companies have made statements before the court asserting that China Fishery's current management is best suited to operate the company during its restructuring.
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Peru defeated an arbitration case brought by Renco Group Inc., claiming that the government had overstepped in authority by ordering its affiliate, Doe Run Peru, to clean up pollution linked to its lead and zinc smelting operations in the mountain town of La Oroya and forcing it into bankruptcy, Bloomberg News reported today. The arbitration panel issued a partial award for Peru on Friday, the Ministry of Economy and Finance said Monday in a statement. Renco, owned by U.S. billionaire Ira Rennert, had sought $800 million in compensation.
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Several of Pacific Andes' major lenders believe that the fishing conglomerate is improperly using US and Peruvian bankruptcy laws to "derail" a planned sale of its Peruvian assets, Undercurrent News reported. In court filings on July 8, several creditor banks of the 16 Pacific Andes entities that declared bankruptcy in the US on June 30 questioned directors' motivations to have three Peruvian subsidiaries of the group file for bankruptcy under that country's laws rather than in the US.
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Peru's government bankruptcy agency, Indecopi, said Tuesday it has officially opened an investigation into Doe Run Peru's financial situation, Dow Jones Daily Bankruptcy Review reported. An Indecopi spokeswoman said creditors have 30 days as of Monday to file credit recovery paperwork. The government has taken a hard line against the company in recent weeks, saying it would start the legal and regulatory process of removing Doe Run's ownership of the plant in the town of La Oroya.
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Peru's Ministry for Mining and Energy said Tuesday it will begin the process of winding down Doe Run Peru's management of the country's only polymetallic smelter. Doe Run, a unit of U.S.-based Renco Group Inc., could also face insolvency and environmental proceedings against it by Peru's regulatory bodies, Osinergmin and OEFA, Dow Jones Daily Bankruptcy Review reported. Osinergmin supervises energy and mining investments, while OEFA is charged with the evaluation of environmental affairs.
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