Brazilian banks turn up heat on scandal-hit Odebrecht

Sao Paulo

BANKS are raising the heat on Brazilian conglomerate Odebrecht SA to put its house in order after months of treating the scandal-hit company with kid gloves because of fears its collapse could hurt their balance sheets, sources said.

Odebrecht has agreed to accelerate asset sales as part of a deal with creditor banks to let the heavily indebted company keep US$800 million from the divestiture of its water and waste unit announced last month, enough to fund its cash needs for two years, according to several executives, bankers and lawyers involved in the talks.

The conglomerate also agreed to surrender to creditors all dividends from its crown jewel, petrochemicals unit Braskem SA, and to place more assets as collateral for loans under ren…