Filing Alert: Braskem Idesa, S.A.P.I. Chapter 11

Braskem Idesa, S.A.P.I., a Miguel Hidalgo, CDMX-based petrochemical company formed in 2010 as a joint venture between Braskem S.A. and Grupo Idesa, filed for...

Braskem Idesa, S.A.P.I. and its debtor affiliates⁽¹⁾, a Miguel Hidalgo, CDMX-based petrochemical company formed in 2010 as a joint venture between Braskem S.A. and Grupo Idesa, filed for Chapter 11 protection on Aug. 17 in the U.S. Bankruptcy Court for the Southern District of Texas.

Braskem Idesa, S.A.P.I. ("BAKIDE") and two affiliates own and operate the Etileno XXI ethane cracker and polyethylene complex at Nanchital, Veracruz — Mexico's largest polyethylene producer — owned 75% by Braskem S.A. and 25% by Etileno XXI, an affiliate of Grupo Idesa. The Debtors attributes the filing to a prolonged petrochemical downcycle and compressed spreads since the second half of 2022, compounded by ethane supplier Pemex cutting ethane deliveries by roughly 71%, from 49 kbpd in 2019 to about 14 kbpd year-to-date through August 2026. That forced a shift from low-cost integrated supply to imported ethane. The replacement chain carries high fixed costs — related-party vessel leases and storage and transportation fees through a new import terminal built by non-Debtor joint venture Terminal Química Puerto México, averaging about $8 million per month — plus higher variable costs.

Those costs worked through both sides of the business. The Debtors' trade base of more than 400 vendors was stretched to average days past due of 150, and constrained working capital held the Complex to average utilization below 50%. Against approximately $3.6 billion in total debt — roughly $2.4 billion of funded debt plus about $1.2 billion of shareholder subordinated loans — BAKIDE conserved cash by skipping funded debt interest payments from November 2025 through July 2026. That funded debt comprises approximately $1.2 billion of 2032 Senior Secured Notes, $900 million of 2029 Senior Secured Notes, $129 million of Senior Secured Term Loans, $101 million under the prepetition working capital facility and $67 million under the prepetition secured prepayment facility. No holder called a default or accelerated while negotiations proceeded, and the working capital lender forbore through Aug. 17, 2026, capitalizing accrued interest into principal. At the terminal level, missed construction milestones and other defaults under TQPM's $408 million credit agreement were addressed through forbearances in December 2025 and July 2026, the latter extending relief to defaults triggered by a chapter 11 filing. Interim liquidity came from the Debtors' own stakeholders: a $34 million upsizing of an emergency Inbursa term loan in October 2025, and $126 million from Braskem entities under the Emergency Braskem Bridge Facilities in March 2026.

The Debtors filed with a prepackaged Plan implementing a Restructuring Support Agreement negotiated with parents Braskem, Inbursa and an ad hoc group of Senior Secured Notes holders, signed by parties holding approximately 79% of the Debtors' prepetition secured debt. It would reduce prepetition funded debt by more than $920 million and divide the fully diluted reorganized equity into three equal 33.3% blocks.

Braskem receives the first block for approximately $486 million of new and equitized capital — a $131 million roll-up of its prepetition bridge financing, approximately $283 million in respect of the new money DIP loans (each inclusive of accrued interest through the Effective Date, the latter also including the DIP commitment fee) and a $71 million cash equity contribution on the Effective Date. Senior Secured Notes holders, including Inbursa, share the second block through equitization of $825 million of notes claims. Existing shareholders have their interests cancelled and receive the third block in Reorganized Class B Shares.

The residual secured debt is refinanced rather than equitized: notes claims above the $825 million equitized amount, together with the Senior Secured Term Loan Claims, share pro rata in approximately $1.6 billion of first lien Exit Notes secured by priming liens on substantially all assets. The approximately $1.2 billion of subordinated shareholder loans are extended beyond the Exit Notes term, subordinated and made fully payable in kind, and third-party general unsecured claims ride through unimpaired.

The Debtors are also seeking approximately $409 million in superpriority, priming DIP facility from affiliates Braskem Netherlands B.V. and Braskem America, Inc. to fund the cases and the production ramp. The facility consists of $279 million of new money — up to $230 million on entry of the Interim DIP Order and $49 million after the final order — plus an approximately $130 million cashless roll-up of the Emergency Braskem Bridge Facilities.

Pricing is 10% payable in kind with no default rate and a 0.50% commitment fee, maturing six months after closing subject to a one-month borrower extension. Estate protections include an $8 million post-trigger professional fee carve-out, a $50,000 committee investigation budget, a 15% permitted variance on operating disbursements and no cross-collateralization

The initial $230 million draw is expected promptly upon entry of the Interim DIP Order to lift production toward design levels, nearly tripling utilization from recent lows. The sizing follows A&M's assessment that the Debtors need $350 million of incremental capital to administer the cases, sustain operations and stabilize post-emergence liquidity — met by the $279 million of new money DIP loans and the $71 million Effective Date equity contribution. Rather than being repaid in cash, the entire facility converts to reorganized equity on the Effective Date, so the Debtors would emerge without having serviced it in cash, with cash repayment retained as a fallback if the Plan fails.

The company reports $1 billion to $10 billion in both assets and liabilities. The filing indicates that there will be funds available for distribution to unsecured creditors. The case number is 26-90762.

⁽¹⁾ Braskem Idesa Servicios, S.A. de C.V. and Braskem Idesa Ethane LLC.

Top Unsecured Claims

Form 204 Top Unsecured Claims
Source: Bondoro, Court filings

Key Parties

Counsel:

General U.S. Restructuring Counsel:

General Mexican Restructuring Counsel:

Financial Advisor:

Investment Banker:

Signatories:

Claims Agent:

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