Galvao Engenharia files for bankruptcy in Brazil
Galvao Engenharia has filed for bankruptcy as a result of Petrobras suspending payments to the company as part of the ongoing corruption investigation in Brazil.
RIO DE JANEIRO – Galvao Engenharia has filed for bankruptcy as a result of Petrobras suspending payments to the company as part of the ongoing corruption investigation in Brazil.
Grupo Galvao also said that Galvao Participacoes, linked to Galvao Engenharia, had filed forbankruptcy.
“From the end of 2013 there were repeated delays in payments owed by Petrobras for several contracts. This was combined with curbed access to credit markets for the construction sector, strongly impacted by Operation Car Wash,” Grupo Galvao, parent company of Galvao Engenharia said.
“Operation Car Wash” is the name given the corruption investigation.
Grupo Galvao said it has cooperated with the authorities and was never involved in the alleged corruption scheme in which engineering and construction firms overcharged Petrobras for work, with the excess being used for bribes.
However, Petrobras said it was up to date with its contractual obligations, adding that claims by contractors for additional payments are evaluated but do not constitute debt on the part of Petrobras.