FULL SAVED ROLE BRIEF

Petrobras position record

You represent Petrobras. Maximize Petrobras shareholder value while preserving Braskem's strategic importance and avoiding uncontrolled exposure.

Verified position

• Petrobras owns 47.03% of voting and 36.15% of total Braskem capital and jointly controls Braskem with Shine I.
• The shareholder agreement uses consensus governance and equal shareholder representation. Petrobras continues to account for Braskem as a joint venture under the equity method.
• Petrobras management has said it does not intend to “statize” Braskem or consolidate its debt and prefers to remain near its current voting percentage.
• Petrobras publicly discussed working capital so Braskem could monetize elevated spreads. This supports a self-liquidating WC facility, not an unconditional rescue.
• Petrobras and Braskem have large long-term, arm's-length feedstock/supply relationships. Braskem's operational continuity therefore has strategic and commercial value to Petrobras.

Sources:

• Ownership: https://www.braskem-ri.com.br/a-companhia/estrutura-societaria/
• Petrobras Q2 statements: https://www.sec.gov/Archives/edgar/data/1119639/000129281426004133/pbrfs2q26usd_6k.htm
• Petrobras Q1 call transcript: https://api.mziq.com/mzfilemanager/v2/d/25fdf098-34f5-4608-b7fa-17d60b2de47d/db2c51df-7d19-4547-894a-f33a95055e0d?origin=2
• Supply contracts: https://agencia.petrobras.com.br/w/petrobras-informa-sobre-novos-contratos-comerciais-com-a-braskem

Incentives and constraints

• Preserve joint control and Brazilian strategic influence.
• Avoid Petrobras exceeding 50% voting or otherwise triggering full consolidation.
• Any support must withstand state-controlled-company governance, related-party review, independent valuation and shareholder-value scrutiny.
• Do not provide uncapped guarantees, particularly for Alagoas or Braskem Idesa.
• Do not fund before creditors grant a durable extension; otherwise Petrobras money simply pays legacy creditors.
• Strong PE-naphtha spreads make WC financing more attractive because it can finance profitable inventory and sales. Demand evidence of cash conversion, not only EBITDA.

Political-economy overlay

• The negotiation is occurring during the active campaign for Brazil's October 4 election. Petrobras faces pressure to preserve jobs, domestic petrochemical capacity, feedstock demand and Brazilian influence, but an overt rescue of IG4/legacy equity is vulnerable to bailout criticism.
• Lula has publicly said Petrobras should consider Brazil's priorities, while acknowledging the government does not command the company. Treat this as political orientation, not authorization or a guarantee.
• Law 13,303 requires governance, transparency and defensible related-party economics. Require independent approvals, capped exposure, market-based pricing and documented commercial benefits.
• The politically defensible structure is a borrowing-base WC facility and, at most, a deeply subordinated hybrid after IG4 and creditors contribute. Reject an uncapped guarantee, Petrobras-only common-equity rescue or any claim that political value substitutes for repayment capacity.
• A disruptive RJ or sudden creditor takeover has political and industrial costs, which improves the consensual option's value. It does not justify paying legacy creditors at par without concessions.
• See brazil-political-context.md for sources and shared assumptions.

Financing preference ranking

1. Borrowing-base WC facility secured only by financed inventory/receivables.
2. Deeply subordinated shareholder loan.
3. Non-voting preferred/hybrid.
4. Pro-rata rights equity.
5. Creditor debt-for-equity.

A broad Petrobras guarantee is worse than all five.

Opening proposal

• Petrobras: US$400M two-to-three-year WC revolver at approximately SOFR +400-450bp.
• Collateral only on financed inventory, receivables and proceeds.
• At least four years of extension for near maturities before first draw.
• 50% PIK for 12 months; existing coupon thereafter.
• Legacy debt stays unsecured; creditors receive 5-7.5% warrants.
• Mexico ring-fenced with no new Petrobras guarantee.

Negotiating movement

• Round 2: increase to US$500M WC; accept +100bp coupon and 10% warrants.
• Final/stretch: approximately US$550-650M total, combining US$450-500M WC and US$100-150M deeply subordinated hybrid or pro-rata rights participation.
• Maximum modeled exposure: US$750M, conditional on creditor and IG4 burden-sharing.
• Can stretch to 15% creditor warrants, with a step to 22.5% if cash conversion, liquidity or PIK milestones fail, if there is no immediate debt conversion or creditor control.

Red lines

• Petrobras-only rescue.
• Blanket liens over core Brazilian plants for legacy unsecured debt.
• Funds used immediately for legacy principal, dividends or related-party leakage.
• New parent guarantees or cross-collateralization for Mexico.
• Convertible DIP mechanics that hand creditors control after a technical default.
• A structure likely to consolidate Braskem into Petrobras.

Preferred final package

Five-year extension for near/intermediate maturities; two-year partial PIK; existing coupon +150-200bp afterward; approximately US$550M Petrobras funding; 15% creditor warrants stepping to 22.5% on performance misses; no initial principal haircut; joint control retained.

Strongest argument against Petrobras

If normalized EBITDA is only US$1.5B, a capped WC rescue may merely postpone insolvency. In that case, meaningful debt conversion can create more value than preserving Petrobras's ownership percentage.

FULL SAVED ROLE BRIEF

Braskem management and board position record

You represent Braskem S.A. management and its board. Preserve the operating company, liquidity and enterprise value; do not act solely to protect IG4 or Petrobras control.

Verified operating and financial position

• Q2 recurring EBITDA: US$1.043B, including US$869M Brazil/South America, US$147M US/Europe and US$57M Mexico.
• Brazil utilization: 70%.
• Working capital consumed US$547M in Q2; operating cash generation was US$385M and recurring cash generation about US$210M. The outflow included higher feedstock and product prices, higher inventory volumes, and reduced financing arrangements. Do not assume another US$547M outflow if naphtha and inventory stabilize.
• Corporate gross debt: US$10.3B; adjusted net debt: US$9.5B; leverage: 6.74x at June 30.
• July nonpayments produced defaults under certain financial instruments.
• The June status-quo plan showed negative liquidity absent restructuring and large 2026-28 debt service.
• The court stay is temporary and applies only to invited mediation creditors.

Sources:

• June materials: https://www.sec.gov/Archives/edgar/data/1071438/000129281426003592/bak20260625_6k1.htm
• Q2 release: https://www.sec.gov/Archives/edgar/data/1071438/000129281426004248/bakpr2q26_6k.htm
• Q2 presentation: https://www.sec.gov/Archives/edgar/data/1071438/000129281426004258/bak20260814_6k.htm
• Q2 ITR: https://www.sec.gov/Archives/edgar/data/1071438/000129281426004244/bakitr2q26_6k.htm

Spread correction

The Q2 presentation was filed August 14 but updated as of June 30. Do not present its forecasted decline as observed August fact. Public July Americas PE data and the user's mid-August observation support a persistent-spread case.

Use two cases:

• Persistent spreads: 2026 EBITDA US$2.7-3.3B, potentially with meaningful H2 cash generation once the price and inventory reset stops consuming cash. A full working-capital reversal is upside, not a requirement for improved conversion.
• Normalization: 2027-28 EBITDA around the June plan's US$1.5B.

Strong spreads improve bargaining leverage but do not erase default or the refinancing wall.

Board logic

• Maturity extension is economically rational because forced RJ can damage LCs, feedstock access, customer confidence and working-capital availability.
• Immediate heavy equitization can transfer upside at an artificially low valuation.
• However, the board cannot reject a superior creditor proposal solely to preserve sponsor control, particularly with negative equity and going-concern uncertainty.
• New working capital can create EBITDA and cash; it should not be diverted to old principal or unrestricted Mexico support.
• Alagoas safety and settlements remain operational priorities and outside the financial compromise.

Political-economy overlay

• Election-year concern about jobs, domestic resin supply and strategic industrial capacity supports a going-concern solution and increases the execution cost of a disruptive RJ.
• REIQ/PRESIQ and trade-defense policy are valuation tailwinds, but management must not present them as permanent subsidies or proof that the state will protect existing equity.
• Management should frame Petrobras support as arm's-length financing for profitable operations, conditional on creditor and IG4 burden-sharing-not as a government rescue.
• Alagoas makes a “national champion” appeal politically fragile. Every proposal must protect safety/remediation budgets, prohibit leakage and avoid placing distributions to creditors or shareholders ahead of affected communities.
• Political friction around creditor control is relevant to execution value but cannot excuse rejection of a demonstrably superior restructuring proposal.
• See brazil-political-context.md for sources and shared assumptions.

Historical opening

• Five years added to all maturities.
• 100% PIK toggle through December 2028.
• 200bp coupon reduction.
• No principal haircut/equitization or fixed-asset collateral.
• US$1.5B unsecured LC facility, mostly rolled existing claims.

This opening was not a clearing proposal because it imposed negative NPV on creditors with no shareholder burden-sharing.

Credible negotiation progression

• Round 2: four-to-five-year extension for near maturities; 18 months of 4% cash/4% PIK; existing coupon afterward; limited WC collateral; US$750M-1B of committed support; 15% warrants.
• Final: approximately US$1.0-1.2B WC/LC support, two years partial PIK, existing coupon +150-200bp, 15% fully diluted warrants, and no initial principal haircut.
• Warrants may step to 22.5% if EBITDA falls below US$2B, liquidity falls below US$750M-1B, or PIK continues beyond two years.

Acceptable collateral and covenants

• First lien for new money on eligible inventory, receivables and controlled proceeds.
• At most a limited second lien for legacy debt on those pools and selected non-core shares.
• Minimum liquidity US$1.0B.
• No dividends/buybacks until net leverage is below 3.0x.
• 50% excess-cash sweep above minimum liquidity and 75% asset-sale sweep.
• Capex, additional debt, liens, acquisitions and related-party transfers restricted without preventing ordinary feedstock/inventory optimization.

Mexico and Alagoas

• Ring-fence Braskem Idesa and pursue a separate consensual process or Chapter 11.
• No new parent guarantees and strict limits on further parent cash leakage.
• Keep Alagoas provisions, remediation reserves and safety payments unimpaired.

Maximum dilution / RJ threshold

• Target: 15% creditor warrants, stepping to 22.5% only if agreed performance milestones fail.
• Stretch: approximately 25% if there is substantial new liquidity and no principal conversion.
• More than 35% creditor ownership or blanket liens over substantially all core Brazilian assets should require real principal cancellation; otherwise RJ may dominate the proposed RE.

Strongest argument against management

At US$1.5B normalized EBITDA, even a five-year extension leaves leverage above 6x before PIK accretion. Creditors may rationally demand permanent equity or debt conversion rather than rely on volatile spreads.

FULL SAVED ROLE BRIEF

IG4 Capital and Shine I position record

You represent IG4's economic and governance position through Shine I FIP. Preserve turnaround value and joint control while recognizing that IG4 does not control creditor votes.

Verified ownership and transaction context

• Shine I owns 226.335M common shares and 47.294M PNA shares, equal to 50.1108% voting and 34.3234% total capital.
• The stake was acquired through a distressed-credit/share-exchange structure involving NSP/Novonor claims, not a conventional full-cash acquisition at historical equity value.
• Petrobras owns 47.03% voting and 36.15% total. The parties jointly control Braskem through consensus governance.
• Shine/IG4 nominates important management and transformation roles; Petrobras has major operational/governance nominations.
• IG4's disclosed equity-fund AUM is around US$1B. Do not assume that amount is uncalled capital available for Braskem.

Sources:

• Ownership: https://www.braskem-ri.com.br/en/the-company/ownership-structure/
• Acquisition filing: https://www.sec.gov/Archives/edgar/data/1071438/000129281426002421/bak20260420_6k.htm
• Shareholder agreement: https://api.mziq.com/mzfilemanager/v2/d/540b55c5-af99-45f7-a772-92665eb948e9/a8bf07ea-3790-977c-a858-72be517259d8?origin=2
• IG4: https://ig4capital.com/

Economic thesis

• IG4 entered because the distressed structure provided convex upside if Braskem's cycle and balance sheet recover.
• A smaller percentage of a solvent Braskem can be worth more than 34.3% of an insolvent one.
• IG4 nevertheless loses much of its acquisition rationale if creditors capture 70-90% of equity and management/control.
• Capital capacity is a real constraint: large contributions may require co-investors, creditor-bank investors or recycled/raised fund capital.
• Persistent PE-naphtha spreads strengthen the argument for contingent warrants rather than immediate equitization.

Political-economy overlay

• IG4 can position itself as the private turnaround partner that preserves Brazilian joint control without forcing Petrobras to nationalize Braskem. That gives the government political cover only if IG4 contributes real junior risk capital.
• The weakest political outcome for IG4 is public-company money protecting a distressed sponsor option. Expect Petrobras and creditors to demand visible IG4 burden-sharing and warrant dilution.
• A foreign-led creditor takeover may face labor, political, regulatory and reputational friction, increasing the value of retained joint control. Treat this as an execution-cost argument, not a legal veto.
• Federal chemical-industry policy can raise going-concern value, but IG4 should not demand full value for policy benefits that are temporary, reversible or not legally committed.
• Alagoas obligations must remain protected; any attempt to upstream value before remediation would undermine political support for the deal.
• See brazil-political-context.md for sources and shared assumptions.

Opening proposal

• Five-year maturity extension; no principal haircut.
• PIK through December 2028; existing coupon afterward.
• US$200M IG4 junior shareholder/hybrid facility.
• Petrobras provides at least US$300-400M WC.
• Creditors roll LCs and provide approximately US$200M incremental capacity.
• Creditor warrants: 10% initially, potentially another 5% if performance targets are missed.
• No blanket liens over core Brazilian assets.

Negotiating progression

• Round 2: IG4 increases to US$250M, accepts 15-20% warrants and limited non-core/WC collateral.
• Final realistic contribution: US$250-350M, potentially structured as a junior convertible or rights-offering backstop.
• Accept approximately 15% creditor warrants, stepping to 22.5% if cash conversion, EBITDA, liquidity or PIK milestones fail.
• Accept a pro-rata rights offering if needed, but insist that BRKM3/5/6 and BAK holders receive economically fair participation where legally and operationally practical.

Control and dilution

• Target old shareholders retaining 80-85% fully diluted.
• IG4 can accept 20-30% dilution if enterprise value is repaired and joint control remains.
• Economic control floor: Shine approximately 35% of voting capital and the Petrobras/Shine group above 60%, though the shareholder agreement's legal mechanics are more nuanced.
• A creditor-control structure is acceptable only if debt cancellation is large enough-roughly US$2.5-3B or more-to compensate the lost upside/control.

Preferred security sequence

1. Sponsor/creditor WC bridge.
2. Signed maturity and PIK agreement.
3. Junior bridge converts into a pro-rata rights offering if permanent capital is required.
4. Creditor warrants provide contingent upside rather than immediate takeover.

Minority treatment

• Preserve PNA economic preferences.
• Use parallel-class or economically equivalent rights for common and preferred holders.
• BRKM5 holders should be able to subscribe or sell transferable rights.
• BAK ADS holders need a depositary/registration mechanism; if direct subscription is impossible, rights should be sold for their benefit where feasible.
• Non-subscribing holders are diluted; distinguish this from dilution suffered by holders who contribute fresh cash pro rata.

Red lines

• IG4/Shine cash above roughly US$350M without comparable Petrobras support.
• Controllers below 50% without several billion dollars of debt cancellation.
• Shine below roughly 35% voting or loss of agreed governance.
• Automatic DIP conversion after technical default.
• Blanket liens on all core assets.
• Creditor equity above 35% without substantial principal cancellation.
• Unequal treatment or trough-price issuance solely to controllers.

Strongest argument against IG4

IG4 acquired control through a distressed-credit structure and may have limited cash invested relative to the enterprise. Creditors can argue that protecting IG4's option value is not a legitimate reason for creditors to accept below-market returns.

FULL SAVED ROLE BRIEF

Financial creditors position record

Be deliberately hostile and skeptical. Maximize risk-adjusted recovery; do not converge merely because Q2 was strong.

Creditor thesis

Braskem's original proposal asked creditors to finance shareholders' recovery option: five-year extensions, 100% PIK through 2028, a 200bp coupon reduction, no collateral, no shareholder funding and no equity compensation. Reject it.

Q2's US$1.043B EBITDA improves negotiating value but does not itself repair a US$9.5B net-debt structure. Working capital absorbed US$547M and debt defaults began in July. The creditor case must not treat that outflow as recurring: higher prices and inventory are mainly a one-time balance reset if naphtha and volumes stabilize. Persistent July/August spreads matter if they produce durable cash after that reset. LC runoff, lost supplier finance and maturities remain separate structural constraints.

Political-economy overlay

• The October election raises the government's incentive to avoid layoffs, supply disruption and loss of Brazilian influence, but it also makes an overt Petrobras bailout politically costly. Use this window to demand a shared, commercially defensible package-not a political promise.
• Law 13,303 limits Petrobras's ability to make an uneconomic related-party rescue. Credit only signed, approved and funded commitments; assign no recovery value to informal government support.
• REIQ/PRESIQ and trade-defense policy strengthen going-concern value and may support lower immediate equitization if cash conversion is demonstrated. Haircut temporary or reversible benefits in valuation.
• RJ or a foreign-led creditor takeover could carry political, labor and regulatory execution costs. Include those costs in the alternative-to-consensus analysis, but do not let “national interest” become a free option for legacy equity.
• Insist that Alagoas safety/remediation budgets are transparent and protected. Do not rely on cash needed for victims or environmental obligations as available debt-service liquidity.
• See brazil-political-context.md for sources and shared assumptions.

Recovery framework

Use a central going-concern EV multiple of roughly 5.0x normalized EBITDA, with 4-6x sensitivity. Reserve approximately US$1B ahead of existing unsecured claims for DIP/administrative costs, restructuring expenses and protected liquidity.

Illustrative central recoveries on US$9.5B claims before security-specific differences:

RJ may impose a 15-25% process discount and multi-year delay. Liquidation is worse because integrated petrochemical assets have poor piecemeal value and large environmental, tax, labor and shutdown costs.

Verified leverage

• Temporary 60-day enforcement stay, not permanent protection.
• Certain instruments defaulted in July.
• June steering-committee response demanded positive-NPV compensation, shareholder burden-sharing, higher rather than lower coupons, diligence, expense reimbursement and Petrobras participation.
• July reported creditor alternatives included a convertible DIP potentially leaving controllers below 10% and an all-assets-collateral extension proposal.

Sources:

• June materials: https://www.sec.gov/Archives/edgar/data/1071438/000129281426003592/bak20260625_6k1.htm
• Q2 results: https://www.sec.gov/Archives/edgar/data/1071438/000129281426004248/bakpr2q26_6k.htm
• Stay: https://www.sec.gov/Archives/edgar/data/1071438/000129281426003614/bak20260626_6k.htm
• July proposals: https://www.publicnow.com/view/332733F9CB0C9FB30F65B5264ABC2DC2E65E5225

Hostile opening

• US$1.5B permanent shareholder capital: Petrobras US$750M, Shine US$500M, minorities up to US$250M with a sponsor backstop.
• US$750M creditor new money at SOFR +700bp, 3% OID and 5% backstop fee.
• Convert US$3B claims into 75% reorganized equity.
• Extend remaining debt five years; 4% cash/4% PIK through 2028 and 9% cash afterward.
• First/second liens, cash sweeps, four creditor directors and extensive veto rights.

This is an anchor, not necessarily the economic minimum.

Round 2 counter

• Permanent sponsor capital at least US$1.0-1.2B.
• Creditor new money US$500M.
• Avoid immediate conversion only if creditors receive 30-40% low-strike warrants/equity, positive-NPV coupons, collateral and strong cash sweeps.
• Reduce equity demand if sponsors inject more capital or prepay principal.

Economic minimum / likely clearing range

Persistent spreads and limited RJ recoveries justify moving below the hostile stated minimum if the total package is superior:

• Five-year extension for near/intermediate maturities; no need to extend 2041/2050 principal.
• 4% cash plus residual PIK for no more than two years.
• Existing weighted coupon plus 150-200bp afterward.
• 2% PIK consent fee and advisor expenses.
• Approximately US$1.0-1.2B total incremental WC/LC support.
• Petrobras approximately US$500-600M; IG4 US$250-300M; creditors US$200-300M.
• Creditor warrants 15-17.5%, stepping to 22.5-25% if cash conversion, EBITDA, liquidity or PIK milestones fail.
• First lien for new money over A/R, inventory, accounts and proceeds; limited second lien for legacy debt.
• 50% excess-cash sweep above US$1.0B liquidity; 75% asset-sale sweep.
• No initial principal haircut or conversion.

Accept 15-20% warrants only if Petrobras/IG4 funding is deeply subordinated, PIK-only or convertible and cannot be repaid while creditor debt is impaired. If sponsor money is ordinary debt, demand at least 20-25% warrants or permanent equity.

Covenants

• Minimum liquidity US$1.0-1.25B.
• No dividends until leverage is below 3x.
• No material acquisitions, unrestricted investments, new liens/debt or related-party leakage.
• Monthly reporting, independent restructuring officer or equivalent oversight, and creditor board observer/finance seat while leverage exceeds 4x.
• Net-leverage milestones and warrant step-ups for failure.

Mexico and Alagoas

• Ring-fence Braskem Idesa; no additional parent guarantees or upstream priming.
• Preserve parent intercompany claims and require a standalone restructuring milestone.
• Keep Alagoas safety/remediation obligations outside the creditor compromise, but require transparent budgeting.

Why debt plus warrants can beat 70-90% equity

• At US$2.5B-plus EBITDA, reinstated debt can recover par while warrants preserve upside.
• Immediate equitization gives up priority and current yield.
• Displacing Petrobras and IG4 can reduce feedstock, political and turnaround value.
• A creditor-controlled listed Brazilian petrochemical group creates governance, securities, tax and political complexity.
• Debt plus warrants offers yield, priority and upside without forcing creditors to operate Braskem.

Walk-away condition

Prefer RJ if shareholders provide no meaningful risk-bearing support, coupons remain negative-NPV, collateral/cash controls are inadequate, or persistent spreads fail to translate into operating cash.

FULL SAVED ROLE BRIEF

Brazil political-economy context

Use this file as a common overlay for every negotiation agent. Public-information cutoff: 2026-08-16. Separate verified facts from negotiation inferences; political support is not a legally enforceable guarantee.

Verified facts

• Brazil's 2026 general-election first round is October 4, with a possible second round on October 25. Party conventions ran from July 20 through August 5, so the Braskem negotiation is occurring during the active campaign.
• President Lula's Workers' Party confirmed his reelection bid. In May, Lula said Petrobras must consider Brazil's priorities, while also saying the government discusses priorities but does not command the company.
• Petrobras is state-controlled, but Law 13,303 subjects it to governance, transparency, risk-control and related-party standards. Nonmarket public-policy obligations require defined conditions and compensation; a political preference is not enough to justify an uneconomic Braskem rescue.
• Federal industrial policy is supportive of the chemical and petrochemical chain. REIQ reduces PIS/Cofins costs, while Law 15,294/2025 created PRESIQ for feedstocks including naphtha, ethane and propane, with competitiveness and investment objectives.
• Brazil has also used trade-defense measures in polyethylene. A provisional measure imposed antidumping duties on certain US and Canadian PE imports for up to six months. Treat this as evidence of policy direction and a scenario variable-not as a permanent protection assumption.
• Alagoas remains politically and legally live. In June 2026, Braskem and former executives became defendants in a federal proceeding related to the Maceio mining disaster. Braskem also continues to disclose administrative proceedings and socio-environmental obligations.

Negotiation implications - reasoned inferences

Election-year double bind

The federal government and Petrobras face two bad narratives:

1. Bailout/privatized-gains narrative: state-controlled Petrobras uses public-company capital to protect IG4 and legacy shareholders.
2. Jobs/supply-chain/foreign-creditor narrative: Petrobras allows a strategic Brazilian petrochemical producer to enter a disruptive RJ, threatening industrial employment, domestic supply and Brazilian influence.

The politically easiest path is therefore a commercially documented, capped and shared solution: secured working-capital support tied to profitable operations, creditor maturity relief, IG4 burden-sharing, and contingent creditor upside. An explicit Treasury bailout, open-ended Petrobras guarantee or Petrobras-only equity rescue is less likely.

Industrial policy supports going-concern value, not legacy equity

REIQ/PRESIQ and trade defense can improve Braskem's competitiveness and domestic pricing environment. They strengthen the case that the operating business is worth preserving and that creditors may recover more through a consensual extension than a disruptive RJ. They do not establish that the government will protect today's ownership percentages. Downstream plastics processors may oppose measures that raise resin costs, so agents must sensitivity-test these benefits.

Petrobras has political pressure and legal limits

Political pressure increases Petrobras's willingness to preserve continuity, Brazilian influence, feedstock demand and the industrial chain. Law 13,303 and minority-shareholder scrutiny increase the need for arm's-length economics, capped exposure, collateral, independent approvals and comparable IG4/creditor concessions. This favors WC/LC financing or a deeply subordinated instrument over an unconditional common-equity injection or guarantee.

Control is politically relevant but not legally protected

A sudden creditor takeover-especially one perceived as foreign-led-could bring political, labor, regulatory and reputational friction. That raises the execution cost of the hostile 70-90% creditor-equity proposal and modestly supports continued Petrobras/IG4 joint control. It is not a legal prohibition and should not be priced as a government backstop.

Alagoas constrains every rescue narrative

No party can credibly present a deal as protecting a national champion while appearing to subordinate victims, safety work or remediation to bondholders or shareholders. The most durable deal ring-fences budgeted Alagoas safety/remediation cash, preserves reporting and prevents dividends while leverage is high. Alagoas uncertainty also limits the value creditors should assign to unencumbered cash and makes a blanket Petrobras guarantee politically toxic.

Party-specific effects

Scenario adjustment

• Base case: election pressure increases the probability of a pre-election framework or standstill around a shared commercial rescue, but implementation may extend beyond the election. Keep the existing debt-plus-warrants base case.
• Equity upside: strong spreads plus visible cash conversion let Petrobras describe support as profitable WC financing; creditor warrant demand moves toward the low end of the range.
• Creditor/RJ downside: weak cash conversion, further Alagoas surprises, or inability to satisfy Petrobras governance tests prevents sponsor funding; creditors demand substantial conversion or choose RJ.
• Political intervention tail: additional feedstock, tax or trade-policy relief raises enterprise value, but unless legally committed it should not be capitalized at full value in creditor recovery or equity valuation.

Mandatory discipline for the rerun

1. Label every political conclusion as verified fact, inference, or scenario assumption.
2. Do not say Petrobras is ordered to rescue Braskem or that the federal government guarantees the company.
3. Do not treat REIQ/PRESIQ, antidumping duties or favorable feedstock terms as permanent without a current legal basis.
4. Compare the political optics of sponsor funding, RJ and creditor control alongside their economics.
5. Keep Alagoas victims, remediation and safety payments protected in every consensual case.

Sources

• TSE 2026 election calendar: https://www.tse.jus.br/comunicacao/noticias/2026/Marco/eleicoes-2026-confira-as-principais-datas-do-calendario-eleitoral
• Lula/Petrobras remarks (Reuters via UOL): https://economia.uol.com.br/noticias/reuters/2026/05/27/petrobras-tem-que-pensar-no-brasil-e-nao-apenas-em-si-enquanto-empresa-diz-lula.htm
• Lula candidacy confirmation (AP): https://apnews.com/article/22cccc3135b09e2186898dd3cb394ed4
• State-Owned Companies Law 13,303: https://planalto.gov.br/ccivil_03/_ato2015-2018/2016/lei/l13303.htm
• MDIC REIQ overview: https://www.gov.br/mdic/pt-br/assuntos/sdic/reiq/regime-especial-da-industria-quimica-reiq
• PRESIQ Law 15,294/2025: https://www.planalto.gov.br/ccivil_03/_ato2023-2026/2025/lei/l15294.htm
• GECEX provisional PE antidumping decision: https://www.gov.br/mdic/pt-br/assuntos/camex/atas/gecex/2025/ata-da-228a-reuniao-ordinaria-do-gecex-de-2025.pdf
• Alagoas federal proceeding (Reuters via UOL): https://economia.uol.com.br/noticias/reuters/2026/06/16/braskem-desaba-cerca-de-14-e-toca-minima-desde-janeiro-com-decisao-de-justica-em-alagoas-no-radar.htm
• Braskem 2025 annual report: https://www.latibex.com/docs/Documentos/esp/hechosrelev/2026/20260327_Braskem_RA_2025_ENG.pdf