By Brazil Stock Guide – The proposed rescue of Oncoclínicas S.A. (ONCO3 BZ) through a structure involving Grupo Fleury S.A. (FLRY3 BZ) and Porto Seguro S.A. (PSSA3 BZ) is facing open opposition from one of its key shareholders. Investment firm Mak Capital has sharply criticized the plan to create a new entity (NewCo), arguing it is overly complex, too slow to implement, and ineffective in solving the company’s immediate liquidity crisis.
According to a letter from Mak Capital to Oncoclínicas, obtained by NeoFeed and Valor, the fund argues that the proposed structure would shift the company’s main cash-generating assets into a new entity, leaving behind a weakened balance sheet burdened by high debt and limited cash flow. In Mak’s view, this would erode residual value for existing shareholders while failing to address the company’s most pressing issue: short-term liquidity.
The structure proposed by Porto and Fleury is more defined. Oncoclínicas would transfer its oncology clinics into a new entity, or NewCo, along with up to R$2.5 billion (about $500 million) in liabilities. Fleury and Porto would jointly control the business through a holding company, investing R$500 million (about $100 million) in equity and an additional R$500 million via convertible debentures. The notes would mature in 48 months, pay 110% of CDI and allow conversion after 36 months or upon a liquidity event.
Liquidity strain
Mak Capital’s criticism comes amid mounting financial pressure. Oncoclínicas carries a multi-billion-real net debt load and faces significant maturities in the coming quarters, with limited cash on hand. Even after a recent capital increase, the company remains undercapitalized and vulnerable, according to the fund. Mak also warns that the Fleury–Porto proposal could take too long to structure and execute, increasing the risk of further deterioration in the company’s financial position given the urgency of its situation.
Alternative proposal
As an alternative, Mak Capital says it is working with other investors on a potential capital injection of up to R$500 million. The proposal, however, is conditional on a major governance overhaul, including the removal of the current board of directors. The fund argues that replacing the board is necessary to restore credibility, accelerate decision-making, and implement a more direct restructuring focused on stabilizing cash flow.
Escalating dispute
The situation highlights a growing power struggle over the company’s strategic direction. On one side is the current management pursuing a structured solution with Fleury and Porto; on the other is a significant shareholder advocating for a faster, more straightforward recapitalization.
Recent share price volatility reflects investor uncertainty over which path will prevail. The outcome will likely depend on whether Oncoclínicas can convince shareholders and creditors that it has a credible — and timely — plan to stabilize its finances.
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