Brazilian coffee exporting companies Atlântica Exportação e Importação SA (Atlantica) and Cafebras Comércio de Cafés do Brasil SA (Cafebras) — both part of the Montesanto Tavares Group — have filed for bankruptcy.
The companies said they are seeking protection from creditors, with debt totaling 2.13 billion reais (US$367 million, as of this writing).
The United States-based sibling company of Atlantica and Cafebras within Brazil’s Montesanto Tavares Group, green coffee importer Ally Coffee, was not named in the bankruptcy filing.
Daily Coffee News photo by Nick Brown.
According to a statement published by the Atlantica and Cafebras on Feb. 28, the bankruptcy protection filing is in response to “financial crisis” brought about by a significant number of rollovers — i.e. extensions of coffee delivery deadlines to producers — and contract defaults by producers.
The groups attributed the defaults to the relatively high benchmark prices that have affected the coffee industry over the past year, as well as the devaluation of the real in relation to the dollar.
Both companies late last year asked a Brazilian court for a grace period for debt negotiations with creditors including Banco do Brasil, BTG Pactual and Banco do Nordeste, as first reported by Marcelo Teixeira at Reuters. With those negotiations apparently unsuccessful, the companies proceeded with an official bankruptcy filing in a Brazilian district court in Belo Horizonte.
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Nick Brown
Nick Brown is the editor of Daily Coffee News by Roast Magazine.
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