By Brazil Stock Guide – Oncoclínicas do Brasil Serviços Médicos S.A. (B3: ONCO3) said it received a letter from Starboard Asset Ltda. outlining interest in a potential financial restructuring that could reshape its balance sheet. The proposal, disclosed in a material fact on Wednesday, remains non-binding and subject to negotiations with the company’s management.
Starboard said it is ready to acquire up to BRL 1.7 billion ($325 million) in third-party credits at 50% of face value, contingent on buying at least BRL 1.5 billion. The credits would be converted into equity through a capital increase, with two subscription warrants attached to each new share. In addition, Starboard proposed a BRL 800 million ($153 million) cash injection: up to BRL 200 million from its funds and at least BRL 600 million from existing shareholders, with three warrants per share subscribed.
Cristiano Affonso Ferreira de Camargo, Oncoclínicas’ investor relations officer, said the board has yet to take a position and will inform shareholders of further developments.
Governance questions on the table
The letter also touched on governance issues and the negotiation of binding documents, though the company stressed no definitive commitments were made. The board’s decision will be crucial as the oncology group carries BRL 3.9 billion ($747 million) in net debt, equal to 4.4 times its EBITDA, almost double its market capitalization of BRL 2.1 billion ($402 million).
Oncoclínicas has sought to reduce leverage through asset sales and potential equity raises. In August, shareholders approved an increase in the company’s authorized capital, paving the way for potential transactions. Starboard’s move comes as private equity and strategic investors eye opportunities in Brazil’s health-care sector, where debt restructuring has become common after years of aggressive expansion.
Starboard emphasized the proposal is not binding and may evolve after due diligence and discussions with Oncoclínicas’ management. The board has not yet expressed support or opposition. Shareholders, including Centaurus (37%), Banco Master (15%), Latache (14%) and CEO Bruno Ferrari (8%), will play a key role in shaping the outcome.
Since its IPO in 2021, which brought in about R$2.6 billion, Oncoclínicas has repeatedly tapped investors. In 2023 it carried out a follow-on of roughly R$900 million, and in May 2024 it approved a R$1.5 billion private capital increase, of which Banco Master contributed R$1 billion.
The new move comes as liquidity deteriorates and debt pressures mount. More than R$2.5 billion falls due between 2025 and 2027, while working capital has consumed an average 77% of EBITDA over the past three years — 130% including interest.
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