Eletronet's bankruptcy looks like it may take longer than the company expected when it filed. The 5th Corporate Section of the Rio de Janeiro State Court has decided not to rule on the application until the company complies with requests from the Public Prosecutor to regularize the documentation filed with the court as part of its petition. Apparently it omitted to include financial statements drawn up specifically for a bankruptcy application as well as details of equity ownership. Eletronet is controlled by the Brazilian Government via Eletrobras and U.S.-based energy group AES. The Public Prosecutor also wants an expert opinion on the necessity for and feasibility of Eletronet's continuing to operate after it's declared bankrupt, as requested in the petition.
The court ruling, signed by Judge Ellen Garcia Mesquita Lobato, calls on Eletronet's three largest creditors — Furukawa, Lucent and Lightpar — to say whether they're interested in appointing a bankruptcy trustee to manage its affairs. The decision now has to be published and the parties notified. This is all expected to take at least two weeks, aggravating Eletronet's problems since besides a shortage of cash with which to discharge its immediate obligations the company may now be abandoned by its customers.
Furukawa has already announced its opposition to the bankruptcy, but Lightpar shows signs of accepting and may be prepared to appoint a trustee, according to sources consulted by TELETIME News.
Eletronet's application for a court order guaranteeing normal business operations, filed together with the bankruptcy petition, claims that interruption would be harmful to 94% of the Brazilian population since, it says, the fiber-optic network is essential to the distribution of power generated by Eletrobras (Eletrosul Furnas, Eletronorte, and Chesf).