By Brazil Stock Guide – Oi (BVMF: OIBR3) declared on Friday (Nov. 7) that it is unable to pay its debts and has requested a formal insolvency assessment from the 7th Business Court of Rio de Janeiro. Court-appointed administrator Bruno Rezende said the company can no longer meet its obligations under its restructuring plan and asked the court to consider liquidation while temporarily maintaining essential telecom operations to avoid service disruption.
Second collapse in less than a decade
The move marks another dramatic chapter for Oi, which is undergoing its second court-supervised restructuring in less than ten years. The company now carries an estimated R$44 billion ($7.8 billion) in liabilities. In late September, Judge Simone Gastesi Chevrand partially advanced the effects of a bankruptcy ruling, removing the entire management team, including CEO Marcelo Millet, and freezing the shares of Oi Fibra, now part of V.tal, controlled by BTG Pactual (BVMF: BPAC11).
Rezende and Tatiana Binato, appointed as judicial administrators, took over daily operations after the court found “strong evidence of asset stripping” and irregular financial transactions. Chevrand also flagged questionable spending, including about $100 million in foreign legal fees tied to an unsuccessful Chapter 11 attempt in the U.S.
Asset sales couldn’t stop the decline
Since its first restructuring in 2016, Oi has sold off major assets to reduce leverage. Its fiber unit became V.tal; the Oi Fibra brand was renamed Nio; and the pay-TV arm was sold to Mileto Tecnologia. The group retained Oi Soluções, which provides cloud, cybersecurity, and IoT services to corporate and government clients.
Even after years of asset sales, the company failed to restore cash generation. In 2024, Oi ended its fixed-line concession, losing its public-service mandate and continuing operations only in select regions under a private agreement valid through 2028.
End of an era for Brazil’s telecom sector
The insolvency marks the likely end of what was once Brazil’s flagship telecom project — the creation of a national “supercarrier” to rival Telefónica (Vivo), América Móvil (Claro), and TIM (BVMF: TIMS3). Once dominant in landline services, Oi was undone by heavy debt, management turmoil, and rapid technological change.
The court is expected to decide in the coming weeks whether Oi will be formally liquidated. If so, the operations may continue on a temporary basis to ensure the delivery of essential phone and internet services during the transition.
In a separate filing
Pacific Investment Management Company LLC (PIMCO) informed today Oi’s investor relations department that its funds sold 6.33 million common shares, reducing their stake by 1.93% to 34.63% of Oi’s total and voting capital. The U.S. asset manager said it has no plans to alter Oi’s control structure or management composition, nor does it hold derivatives or voting agreements involving the company’s shares. PIMCO has been one of Oi’s largest creditors and shareholders since the telecom’s first restructuring in 2016.
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