Braskem Rules Out Asset Sales for Now, Focuses on Capital Restructuring in 2025
- Why Is Braskem Avoiding Asset Sales?
- How Did Markets React to Braskem’s Restructuring Plans?
- What Operational Tweaks Is Braskem Making?
- What’s Next for Braskem’s Financial Health?
- FAQs: Braskem’s Restructuring Strategy
Braskem, the Brazilian petrochemical giant, has no immediate plans to sell assets as part of its capital restructuring efforts, according to CEO Roberto Ramos. Instead, the company is exploring alternative financial strategies to strengthen its balance sheet. Despite market speculation, Braskem’s leadership emphasizes prioritizing cash flow over short-term asset sales. The company’s shares surged 14% on the Ibovespa amid Optimism about its restructuring plans. Meanwhile, Braskem continues operational improvements, including cost-saving raw material swaps and addressing leverage challenges in its Mexican joint venture. Here’s a deep dive into the latest developments.
Why Is Braskem Avoiding Asset Sales?
CEO Roberto Ramos made it clear: selling assets now WOULD mean trading current cash flow for future gains—a move he believes only makes sense under highly favorable conditions. “We have no plans to sell any assets at this time,” Ramos stated during a post-earnings press conference. The company hired financial advisors in September to explore alternatives, focusing on rebalancing equity and debt rather than divestitures. Ramos likened the strategy to pandemic-era precautions, noting the recent $1 billion standby credit drawdown as a buffer against industry uncertainty.
How Did Markets React to Braskem’s Restructuring Plans?
Braskem’s stock soared 14% on the Ibovespa, outpacing the index’s 1.47% rise. The rally was fueled by renewed speculation about Novonor’s potential stake sale—a topic Braskem executives declined to address, citing non-involvement in negotiations. Financial director Felipe Jens confirmed that restructuring talks remain ongoing, with no final decisions yet. Investors seem bullish on Braskem’s ability to navigate its Leveraged position, which stood at 14.76x EBITDA as of September, up sharply from 6.08x a year earlier.
What Operational Tweaks Is Braskem Making?
Facing a global petrochemical slump, Braskem is swapping pricier naphtha for cheaper propane at its Copesul plant in Rio Grande do Sul. Ramos called the efficiency gains “slightly better than expected” but noted the company won’t accelerate the shift while naphtha prices stay low. In Mexico, the Braskem Idesa JV is working to reduce its 25x leverage ratio after a maintenance-related production halt. Ramos expects improved output and EBITDA to ease this pressure soon, with the plant already operating above capacity despite Pemex’s reduced feedstock supply.
What’s Next for Braskem’s Financial Health?
Beyond avoiding asset sales, Braskem is tackling its Alagoas liabilities—finalizing a R$1.2 billion settlement for land subsidence claims. The company has idled a PVC plant there and will import EDC from U.S.-based Olin instead. Analysts at TradingView suggest Braskem’s focus on operational fixes over fire sales could pay off if petrochemical demand rebounds. As Ramos put it: “In uncertain times, cash is king—we’re preparing for all scenarios.”
FAQs: Braskem’s Restructuring Strategy
Is Braskem selling assets to reduce debt?
No. CEO Roberto Ramos explicitly dismissed asset sales as a near-term solution, emphasizing alternatives to rebalance capital structure.
Why did Braskem’s stock jump 14%?
Shares rallied on optimism around restructuring progress and Novonor stake sale rumors, though Braskem isn’t directly involved in those talks.
How is Braskem cutting costs operationally?
By using cheaper propane instead of naphtha in Brazil and supplementing Mexican feedstock imports amid Pemex shortages.
