August 17, 2026 – Braskem Idesa, S.A.P.I. and two affiliated debtors (together, “Braskem Idesa” or the “Debtors”) filed for Chapter 11 protection on a prepackaged basis with the U.S. Bankruptcy Court for the Southern District of Texas, lead case No. 26-90762 (Judge Christopher M. Lopez). The Debtors entered Chapter 11 with approximately $3.6bn of outstanding principal debt and a restructuring support agreement (the “RSA”) backed by holders of 76.55% of the Debtors’ senior secured notes, 100% of their senior secured term loan and all of their prepetition shareholders.

The Debtors, a Mexico City-headquartered petrochemical group that operates the Etileno XXI complex in Nanchital, Veracruz and is the primary supplier of polyethylene to the Mexican market, are represented by Timothy A. (“Tad”) Davidson II of Hunton Andrews Kurth LLP. Further advisor appointments include (i) Cleary Gottlieb Steen & Hamilton LLP as bankruptcy co-counsel, (ii) Sainz Abogados as Mexican counsel, (iii) Alvarez & Marsal North America LLC ("A&M") as financial advisor, (iv) Lazard Freres ("Lazard") as investment banker and (v) Kroll as claims and solicitation agent.

The Debtors’ lead Petition notes between 1,000 and 5,000 creditors, estimated assets between $1.0bn and $10.0bn and estimated liabilities between $1.0bn and $10.0bn. Documents filed with the Court list the Debtors’ three largest unsecured creditors as (i) Petróleos Mexicanos EPE ($8.0mn trade payable), (ii) Ferrosur, S.A. de C.V. ($7.9mn trade payable) and (iii) WEG Gas Mexico, S.A.P.I. de C.V. ($6.8mn trade payable).

In a press release announcing the filing, Braskem Idesa said it had “reached a comprehensive consensual restructuring agreement with all of its major stakeholders,” including Braskem S.A., Braskem Netherlands B.V., Grupo Idesa S.A. de C.V., its term loan lender and a substantial majority of its noteholders. The Company said the restructuring would “raise fresh capital and substantially de-leverage” its balance sheet, reducing total senior debt from approximately $2.5bn to approximately $1.6bn....As part of the restructuring, Braskem, the Company's majority shareholder, will be contributing a total of US$476 million (inclusive of certain amounts funded prior to the bankruptcy filing), underscoring its renewed commitment to Braskem Idesa and its future growth. Upon emergence, Braskem will continue to own a majority stake of the Company's reorganized equity and Idesa and its affiliates will be the Company's largest minority shareholder....The Company is targeting to emerge from its Chapter 11 proceedings within approximately 60 to 90 days.

UPDATE: On August 18th, the Court hearing the Braskem Idesa, S.A.P.I. cases issued an interim order approving (retroactively and subject to the issuance of a Plan confirmation order): (i) the adequacy of the Debtors’ Disclosure Statement, (ii) proposed voting and solicitation procedures and (iii) a timetable culminating in a September 18, 2026 Plan confirmation hearing [Docket No. 70]. As is customary with prepacks, the order also waives (again subject to final Court sign-off as part of Plan confirmation) the requirements to hold a creditors' meeting and to file SOFAS/financial schedules, provided that the Plan is confirmed on or before the SOFA/Schedule Deadline of October 16th.

Approved Key Dates (approved as proposed)

• Initial Plan Supplement Deadline: September 10, 2026
• Voting Deadline & Opt-Out Deadline: September 17, 2026
• Objection Deadline: September 17, 2026
• Deadline to File Confirmation Brief, Reply, and Voting Report: Three days before the Combined Hearing
• Combined Hearing: September 24, 2026
• SOFA/Schedule Deadline: October 16, 2026 (subject to further extension)

Petition Date Highlights

• Braskem Idesa, operator of the Etileno XXI petrochemical complex in Veracruz and Mexico’s primary polyethylene supplier, files a prepackaged Chapter 11 with approximately $3.6bn of principal debt; Petition lists $1.0bn to $10.0bn of assets and liabilities.
• Filing follows a prolonged petrochemical downturn, declining low-cost Pemex ethane supply and severe working-capital constraints; Etileno XXI operated below 50% of capacity on average in 1H 2026, with more than 400 vendors approximately 150 days past due.
• Debtors stopped servicing much of their funded debt during restructuring negotiations, missing interest payments on both secured-note series and the Inbursa term loan; accrued and unpaid interest exceeded $180.0mn at filing.
• RSA has support from holders of 76.55% of senior secured notes, 100% of the senior secured term loan, Braskem Netherlands’ working-capital and secured PE claims, all subordinated lenders and 100% of existing equity.
• Plan eliminates more than $920.0mn of funded debt, equitizes $825.0mn of secured notes and issues approximately $1.6bn of first-lien Exit Notes for remaining note and Inbursa term-loan claims.
• Reorganized equity is split one-third to Braskem for restructuring funding, one-third to secured noteholders and one-third to existing shareholders; Braskem emerges with at least approximately 58.3%, while Idesa remains the largest minority shareholder.
• Secured notes are projected to recover 85%; the Inbursa term loan, secured PE facility, subordinated loans and Braskem commercial claims are projected at 100%. Third-party general unsecured claims remain unimpaired and are paid in full.
• Braskem-backed DIP provides up to $279.0mn of new money plus a $129.9mn roll-up; DIP claims convert into Braskem’s equity allocation at emergence, alongside a $71.0mn Effective Date cash contribution.
• Filing is separate from Braskem S.A.’s Brazil/Chapter 15 proceedings but directly linked through Braskem’s ownership and financing role; parent obtained provisional Chapter 15 relief in New York on June 30th.
• Plan solicitation launched August 17th; votes and objections are due September 17th, with a combined Disclosure Statement/confirmation hearing proposed for September 24th and an RSA Effective Date milestone within 55 days.

Filing Date Summary

Braskem Idesa enters Chapter 11 with the financing, creditor support and post-emergence ownership structure of its restructuring largely negotiated, but after an extended deterioration in both operating performance and liquidity. The Debtors have approximately $3.6bn of principal debt, including $2.1bn of senior secured notes, $129.0mn under an Inbursa senior secured term loan, $101.0mn of working-capital financing from Braskem Netherlands, $67.0mn under a secured polyethylene facility and approximately $1.2bn of subordinated shareholder loans, against only approximately $17.0mn of cash and equivalents at filing. Braskem Idesa reported negative stockholders’ equity of approximately $414.0mn at year-end 2025.

Since the second half of 2022, the Debtors say a prolonged petrochemical downcycle, compressed industry spreads and declining availability of low-cost ethane from Pemex forced them to shift from an inexpensive integrated feedstock source toward materially more expensive imported ethane carrying higher fixed, shipping, customs and variable costs. Pemex, which originally committed to supply 66,000 barrels of ethane per day and later reduced that commitment to 30,000 barrels, has supplied approximately 14,000 barrels per day since the beginning of 2026. More than 400 vendors were approximately 150 days past due on average, with some unpaid for more than a year, constraining the Debtors’ ability to obtain inputs and fund logistics. Even when polyethylene prices more than doubled during the first half of 2026, insufficient working capital left the Etileno XXI complex operating at less than 50% of capacity on average, preventing Braskem Idesa from fully capturing the temporary pricing increase.

Braskem Idesa missed interest payments on the 2029 senior secured notes in November 2025 and May 2026, the 2032 senior secured notes in February 2026 and the Inbursa senior secured term loan in January, April and July 2026, while also defaulting on interest obligations under the Braskem Netherlands working-capital facility. Noteholders and Inbursa did not accelerate or exercise remedies, and Braskem Netherlands agreed to forbear through the Petition Date. More than $180.0mn of interest was accrued and unpaid at filing. The Debtors were simultaneously rationing trade payments toward vendors necessary to convert inventory into sales or avoid operational disruption and using customer prepayments to pull cash forward.

The proposed balance-sheet reset is set to eliminate more than $920.0mn of funded debt. Of the senior secured note claims, $825.0mn is equitized in exchange for one-third of reorganized equity, while the remaining note claims and the Inbursa term loan are exchanged for approximately $1.6bn of new first-lien Exit Notes. The Disclosure Statement projects an 85% recovery for senior secured noteholders and 100% for the term loan. Braskem separately receives one-third of reorganized equity in exchange for approximately $486.0mn of restructuring funding value, including rolled-up prepetition support financing, DIP funding and a $71.0mn Effective Date cash contribution. Existing shareholders receive the remaining one-third of reorganized equity pro rata to their current 75%/25% ownership.

Braskem emerges with approximately 58.3% of reorganized equity, while Idesa and its affiliates remain the largest minority shareholder. Etileno XXI, the existing 25% shareholder, receives approximately 8.3% through the existing-shareholder allocation. The remaining one-third is distributed economically to senior secured noteholders; non-Inbursa noteholders generally receive their equity exposure through an Equity SPV, while Inbursa receives reorganized shares directly in lieu of its corresponding SPV Notes. The Company accordingly says Braskem will remain the majority owner after emergence and Idesa and its affiliates will remain the largest minority shareholder. Existing equity is impaired and canceled, but holders receive replacement Class B shares rather than being wiped out.

The secured PE facility is projected to recover 100% through treatment under the Braskem commercial claims schedule. Approximately $1.2bn of subordinated shareholder loans are also projected at 100%, but will be amended and restated, extended beyond the maturity of the Exit Notes, remain subordinated and accrue interest in kind. Braskem commercial claims are projected at 100% under the same negotiated schedule. Third-party general unsecured claims are unimpaired and are to be paid in full in cash on the later of their ordinary-course due date or the Plan Effective Date, while other priority claims are also projected to recover 100%. Intercompany claims and interests may be reinstated or canceled at the Reorganized Debtors’ discretion, subject to the consent rights contained in the Plan.

The restructuring is financed through a Braskem-backed DIP providing up to $279.0mn of new money alongside approximately $129.9mn of rolled-up prepetition bridge financing. Rather than being refinanced into additional exit debt, allowed DIP claims are converted into Braskem’s equity allocation at emergence, with Braskem contributing another $71.0mn of cash on the Effective Date. The prepetition bridge financing itself followed an October 2025 $34.0mn emergency term-loan advance from Inbursa and $126.0mn of subsequent Braskem Netherlands funding that the Debtors say was necessary to maintain operations and negotiate the prepack.

The Chapter 11 filing also sits alongside Braskem S.A.’s separate parent-level restructuring proceedings. Braskem S.A. and certain affiliates commenced a Brazilian protective injunction proceeding supporting court-supervised interim mediation on June 24th, followed two days later by a Chapter 15 recognition request in the Southern District of New York; provisional U.S. relief was granted June 30th. Braskem Idesa is not a debtor in that Chapter 15 case, but the proceedings intersect directly because Braskem is Braskem Idesa’s controlling shareholder, principal prepetition bridge lender, DIP funding source and intended post-emergence majority owner. The Disclosure Statement expressly flags that certain Braskem actions could become subject to Brazilian court review or challenge if the parent proceeds into an extrajudicial or judicial reorganization.

Goals of the Chapter 11 Filing

The Omohundro Declaration (defined below), notes that the Chapter 11 cases are intended to implement the RSA and Plan negotiated before filing and reduce prepetition funded debt by more than $920.0mn through a combination of equitization, new securities and additional shareholder funding.

The Plan divides reorganized equity into three equal economic allocations. Braskem receives 33.3% on a fully diluted basis in consideration for approximately $486.0mn of Plan funding value, comprising approximately $131.0mn of rolled-up prepetition support financing including accrued interest through the Effective Date, approximately $283.0mn attributable to DIP new money including accrued interest and the commitment fee, and $71.0mn of new cash equity on the Effective Date. Senior secured noteholders receive 33.3% through the equitization of $825.0mn of note claims, while existing shareholders receive the remaining 33.3% pro rata to their current holdings.

The $486.0mn Plan figure is higher than the $476.0mn contribution cited in the press release because the public-release figure reflects the principal funding package — $126.0mn of funded prepetition Braskem bridge loans, $279.0mn of DIP new money and $71.0mn of Effective Date cash — whereas the Plan calculation incorporates accrued interest and the DIP commitment fee through emergence.

The remaining senior secured note claims and all senior secured term loan claims are exchanged for approximately $1.6bn of first-lien Exit Notes. For most noteholders, the equity component is held through a bankruptcy-remote Equity SPV that owns the relevant Class A shares and issues secured SPV Notes to participating noteholders; Inbursa has agreed instead to take its corresponding reorganized equity directly.

The Disclosure Statement projects an 85% Plan recovery for senior secured notes, 100% for the senior secured term loan, secured PE facility, subordinated loans, Braskem commercial claims and general unsecured claims. Existing equity is not assigned a percentage recovery in the table, although the Disclosure Statement says existing shareholders will receive approximately $486.0mn of reorganized equity using the Plan’s stipulated equity value. The approximately $1.46bn implied Plan equity value is expressly a product of the negotiated Plan terms; the Debtors state that no valuation analysis was prepared in connection with the Plan or Disclosure Statement.

Plan Overview

Braskem Idesa, S.A.P.I. and its affiliated debtors filed a Plan under which it would emerge from Chapter 11 under the ownership of Braskem S.A., existing Senior Secured Noteholders, and existing equity holders. The Plan contemplates reducing funded debt by over $920.0mn, with $825.0mn of Senior Secured Notes Claims being equitized. Braskem S.A. will provide approximately $486.0mn in new money financing and claims equitization in exchange for 33.3% of the reorganized company's equity. The Joint Prepackaged Chapter 11 Plan would preserve the petrochemical and polyethylene production business as a going concern while substantially reshaping the balance sheet and ownership structure. The Company operates a state-of-the-art integrated petrochemical complex situated in Nanchital de Lázaro Cárdenas del Río, Veracruz, Mexico, and utilizes ethane imported from facilities in Texas. The company incurred approximately $3.6bn of prepetition debt to support its operations and facilities. The Debtors say revenue and cash flows subsequently weakened amid a prolonged petrochemical downcycle, compressed industry spreads, and a constrained domestic ethane supply in Mexico, culminating in the August 17, 2026 Chapter 11 filing.

The Senior Secured Notes Claims (Class 3) and Senior Secured Term Loan Claims (Class 4) will receive their pro rata share of approximately $1.6bn of new first lien Exit Notes. In addition, $825.0mn of Senior Secured Notes Claims will be exchanged for 33.3% of the reorganized company’s equity, issued as Reorganized Class A Shares to an Equity SPV. Secured PE Facility Claims (Class 5) and Braskem Commercial Claims (Class 7) will receive satisfaction or payment in accordance with a Braskem Commercial Claims Schedule. Subordinated Loans Claims (Class 6), which total approximately $1.2bn, will be amended and restated to extend their term beyond the Exit Notes, subordinated to the Exit Notes, and become payable in-kind.

General unsecured creditors will remain Unimpaired and will receive payment in full in cash in the ordinary course of business or on the Effective Date, providing a 100% recovery. Other Secured Claims and Other Priority Claims are also Unimpaired and will either be paid in full in cash or Reinstated. The Disclosure Statement characterizes the Plan as providing a 100% recovery on allowed General Unsecured Claims, preventing the substantial reductions in value that would occur in a Chapter 7 liquidation. Existing Equity Interests (Class 11) will be canceled, but each Holder will receive its Pro Rata Share of the Existing Shareholder Equity Allocation, totaling 33.3% of the Reorganized Equity in the form of Reorganized Class B Shares.

The Plan also proposes broad debtor and third-party releases covering the Debtors, the Reorganized Debtors, Consenting Stakeholders, the DIP lenders, various indenture trustees and agents, and an expansive group of related parties. The releases preserve post-effective-date obligations and carve out claims finally determined to involve intentional fraud, gross negligence, or willful misconduct. Related exculpation provisions cover restructuring-related conduct subject to similar misconduct carve-outs.The Plan calls for the corporate governance of the Reorganized Debtors to be consistent with section 1123(a)(6) of the Bankruptcy Code, and the identity and affiliations of the new board of directors and officers will be disclosed in the Plan Supplement prior to the Confirmation Date.

The RSA and Plan

The Disclosure Statement provides [Docket No. 16]: " The RSA and the Plan include the following key terms:

• Treatment of Emergency Funding and New Money Contributions: Braskem S.A. shall receive 33.3% of the equity of the reorganized BAKIDE (the “Reorganized Equity” and reorganized BAKIDE, together with the other reorganized Debtors, the “Reorganized Debtors”), on a fully-diluted basis, in exchange for an aggregate of approximately $486 million in new money financing/claims equitization, consisting of (a) the roll-up of $131 million (inclusive of accrued interest through the Effective Date)of support financing provided prior to the Petition Date, (b) approximately $283 million in respect of the New Money Loans (as defined in the DIP Orders, and inclusive of accrued interest through the Effective Date as well as the DIP commitment fee), and (c) a new money equity contribution of $71 million made on the Effective Date.
• Treatment of Secured Claims: The existing holders of Senior Secured Notes shall receive their pro rata share of 33.3% of the Reorganized Equity, on a fully-diluted basis,through the equitization of $825 million in Senior Secured Notes Claims (the “Senior Secured Notes Equitization Amount”), with the remaining Senior Secured Notes Claims as well as the Senior Secured Term Loan Claims to receive Exit Notes (as defined below) on account of such claims.
• Treatment of Equity Interests: The existing holders of equity interests in BAKIDE shall receive their pro rata share of 33.3% of the Reorganized Equity (the “Existing Shareholder Equity Allocation”), on a fully-diluted basis, pro rata to their existing equity holdings, as Plan consideration for their existing equity interests and post-reorganization support for the Reorganized Debtors.
• Issuance of Exit Notes: On the Plan Effective Date, the Reorganized Debtors shall issue those certain first lien exit notes (the “Exit Notes”) in the aggregate principal amount of approximately $1.6 billion. The Exit Notes shall be issued, on a pro rata basis to: (i) the holders of Senior Secured Notes Claims (less the amount of Senior Secured Notes Claims satisfied through the Senior Secured Notes Equitization Amount); and (ii) the holder of Senior Secured Term Loan Claims. The Exit Notes shall be secured by priming liens on all assets of the Borrower and Guarantors, subject to certain exceptions set forth in the Exit Notes Documents.
• Treatment of General Unsecured Claims: The existing holders of third-party General Unsecured Claims will receive payment in full in cash in accordance with the terms and conditions of the particular transaction giving rise to, or the agreement that governs, such General Unsecured Claim on the later of (i) the date such payment is due in the ordinary course of business or (ii) the Plan Effective Date; provided, however, that no holder of an allowed General Unsecured Claim shall receive any distribution for any Claim that has previously been satisfied pursuant to a final order of the Bankruptcy Court.

The RSA also requires the Debtors to meet certain case milestones, including:

• no later than two (2) Business Days after the Petition Date, the Bankruptcy Court shall have entered the Interim DIP Order, and the Mexican Security Trust Agreement Amendment, Mexican Share Pledge Amendment and the Mexican Non-Possessory Pledge Amendment shall have been executed, and with perfection steps, including notarization and registration under applicable Mexican law, to be completed within the timeframes set forth in such agreements;
• no later than forty (40) calendar days after the Petition Date, the Bankruptcy Court shall have entered the Final DIP Order, approved the Disclosure Statement and entered the Confirmation Order; and
• no later than fifty-five (55) calendar days after the Petition Date, the Effective Date shall have occurred (subject to extension and the Outside Date (as defined in the RSA) as set forth in the RSA).

As contemplated by the Plan, the Company will eliminate more than $920 million of debt from the Debtors’ balance sheet. Critically, because the principal objective of the Plan and the RSA, and of the Chapter 11 Cases generally, is to restructure the Debtors’ various funded debt obligations, the Plan and the RSA contemplate that all third-party general unsecured claims will be unimpaired by the consummation of the transactions described therein. BAKIDE expects to emerge from bankruptcy as a strong, competitive player in the petrochemical market while pursuing long-term stability and growth.

The Debtors and the other parties to the RSA engaged in months of extensive, good-faith, productive negotiations, which ultimately culminated in an agreement on the terms of the Plan.

Accordingly, the Plan represents a global settlement of many complex legal issues, including pursuant to Federal Rule of Bankruptcy Procedure 9019, the litigation of which would significantly lengthen the Chapter 11 Cases, deplete the Debtors’ assets and risk the Debtors’ ability to consummate a successful restructuring."

The following is a summary of classes, claims, voting rights and expected recoveries (defined terms, not otherwise defined below, are as defined in the Plan and/or Disclosure Statement, see also Liquidation Analysis below):

• Class 1 (“Other Secured Claims”) is unimpaired, presumed to accept and not entitled to vote on the Plan.
• Class 2 (“Other Priority Claims”) is unimpaired, presumed to accept and not entitled to vote on the Plan, with an expected 100% recovery.
• Class 3 (“Senior Secured Notes Claims”) is impaired and entitled to vote on the Plan, with an estimated projected recovery of 85%. Treatment: Each Holder will receive its Pro Rata Share of the Senior Secured Notes Exit Notes Allocation and the Equity SPV Notes (except Inbursa, which receives the Inbursa Equitization in lieu of Equity SPV Notes).
• Class 4 (“Senior Secured Term Loan Claims”) is impaired and entitled to vote on the Plan, with an estimated projected recovery of 100%. Treatment: Each Holder will receive its Pro Rata Share of the Senior Secured Term Loan Exit Notes Allocation.
• Class 5 (“Secured PE Facility Claims”) is impaired and entitled to vote on the Plan, with an estimated projected recovery of 100%. Treatment: Satisfaction or payment in accordance with the Braskem Commercial Claims Schedule.
• Class 6 (“Subordinated Loans Claims”) is impaired and entitled to vote on the Plan, with an estimated projected recovery of 100%. Treatment: Loans will be amended, extended beyond the Exit Notes term, subordinated, and payable in-kind.
• Class 7 (“Braskem Commercial Claims”) is impaired and entitled to vote on the Plan, with an estimated projected recovery of 100%. Treatment: Satisfaction or payment in accordance with the Braskem Commercial Claims Schedule.
• Class 8 (“General Unsecured Claims”) is unimpaired, presumed to accept and not entitled to vote on the Plan, with an expected 100% recovery.
• Class 9 (“Intercompany Claims”) and Class 10 (“Intercompany Interests”) are impaired/unimpaired and presumed to accept or deemed to reject.
• Class 11 (“Existing Equity Interests”) is impaired and entitled to vote on the Plan. Treatment: Existing Equity Interests are canceled and each Holder receives its Pro Rata Share of the Existing Shareholder Equity Allocation in Reorganized Class B Shares.

Definitions

• “Reorganized Equity” means equity of Reorganized BI or any successor or assign thereto, by merger, consolidation or otherwise, on and after the Effective Date, consisting of the Reorganized Class A Shares and the Reorganized Class B Shares.
• “Exit Securities” means, collectively, the Reorganized Equity, the Equity SPV Notes and the Exit Notes.

For further detail on the Debtors' prepackaged Plan, see our comprehensive data set.

Key Document

The Disclosure Statement [Docket No. 16] attaches the following:

• Exhibit A: Plan
• Exhibit B: Restructuring Support Agreement
• Exhibit C: Corporate Structure Chart
• Exhibit D: Financial Projections
• Exhibit E: Liquidation Analysis

DIP Financing

The Debtors seek approval of a Braskem-provided, priming senior secured superpriority DIP facility consisting of up to $279.0mn of new money and approximately $129.9mn of rolled-up prepetition Braskem bridge debt. Of the new money, $230.0mn becomes available upon entry of the interim DIP order and the remaining $49.0mn following final approval. Approximately $103.9mn of the roll-up would occur at the interim stage and $26.0mn at final approval. The new money and roll-up loans accrue interest at 10% per annum, payable in kind, and the new money carries a 0.5% commitment fee, also paid in kind.

The rolled-up obligations trace to emergency financing Braskem Netherlands extended as the Debtors’ liquidity deteriorated before bankruptcy: $25.0mn through the secured PE facility in March 2026 and $101.0mn under the working-capital facility, for $126.0mn of funded bridge financing. Lazard managing director Christian Tempke says that financing was necessary to keep employees and suppliers paid, maintain the facilities and provide enough runway to negotiate the RSA rather than move toward liquidation.

The DIP is also integrated directly into the Plan. Rather than being repaid with cash or refinanced into post-emergence funded debt, allowed DIP claims are exchanged for a portion of Braskem’s 33.3% reorganized-equity allocation. Braskem then contributes another $71.0mn of cash on the Effective Date.

Lazard's Christian Tempke says Lazard began marketing potential DIP financing in March 2026 and initially contacted 20 potential third-party sources in addition to Inbursa and the ad hoc noteholder group. Only one produced an alternative proposal, a nonbinding junior facility conditioned on significant credit support from an indirect shareholder that was unwilling to provide it. The process ultimately produced no actionable third-party alternative. Inbursa and the ad hoc group also informed the Debtors that they would not consent to a priming DIP from a party other than Braskem, citing both Braskem’s willingness to take equity at emergence and the DIP’s integration into the broader RSA transaction.

The RSA and DIP financing impose an accelerated case timetable. The interim DIP order is required within two business days of the Petition Date; the final DIP order, Disclosure Statement approval and confirmation order are due within 40 calendar days; and the Effective Date is required within 55 calendar days, subject to the RSA’s extension provisions. The Debtors’ public 60- to 90-day emergence target therefore provides a broader external timetable than the milestones governing the financing and RSA.

For further detail on the Debtors' DIP financing arrangements, see our comprehensive data set.

Events Leading to the Chapter 11 Filing

In a declaration in support of first day filings (the "Omohundro Declaration") [Docket No. 5] A&M's Ryan Omuhundro describes a deterioration beginning with the petrochemical downturn in the second half of 2022 and compounded by constrained access to competitively priced ethane in Mexico. Margin compression, higher feedstock costs and capital requirements depleted liquidity and left the Debtors unable to fund the working capital needed to run the Etileno XXI complex efficiently. By the first half of 2026, the plant was operating below 50% of capacity on average even as polyethylene prices temporarily surged, while the Debtors’ more than 400 vendors were, on average, approximately 150 days past due. The liquidity deficit moved into the capital structure as missed debt-service payments accumulated, ultimately leaving more than $180.0mn of accrued and unpaid interest at filing.

The financing response began in October 2025, when Inbursa supplied $34.0mn of emergency term-loan funding. Braskem followed with $126.0mn of funded bridge financing during 2026. In parallel, the Debtors negotiated with an ad hoc group of holders of the 2029 and 2032 notes, Braskem and Inbursa, while Lazard tested the third-party DIP market. Those discussions culminated in the August 17th RSA and prepackaged Plan.

The parent-level chronology overlapped with that final phase of negotiations. On June 24th, Braskem S.A. and certain affiliates commenced their Brazilian protective proceeding in support of interim mediation; on June 26th, their foreign representative sought Chapter 15 recognition in New York; and on June 30th, the New York court granted provisional relief. The August 17th Braskem Idesa Chapter 11 filing is not a conversion or continuation of that Chapter 15 proceeding — Braskem Idesa is a separate debtor group — but the proceedings intersect through Braskem’s ownership, financing commitments and continuing role under the Plan. The Disclosure Statement warns that certain Braskem actions could become subject to review or challenge in Brazil if the parent proceeds into recuperação extrajudicial or recuperação judicial.

Drilling down, Omohundro provides:

• The Petrochemical Market. In recent years, the Company’s business has struggled to generate the cash flows necessary to support its existing capital structure. Since the second half of 2022, the Debtors have operated in an exceptionally challenging environment driven by a prolonged petrochemical downcycle, compressed industry spreads and constrained ethane supply in Mexico, which increased feedstock costs and limited plant utilization. During this period, the Debtors also had to fundamentally change their feedstock procurement process, shifting from an inexpensive and integrated source to one requiring significant fixed costs and materially higher variable costs. These conditions significantly weakened operating cash flow and left the Debtors with severely constrained liquidity. Their trade base of more than 400 vendors has been stretched, with invoices approximately 150 days past due on average and some vendors unpaid for more than a year. The resulting pressure further constrained the Debtors’ ability to return the Etileno XXI complex to optimal operating levels and to fund logistics providers necessary to deliver finished products. Although polyethylene prices more than doubled during the first half of 2026 amid significant geopolitical and supply volatility, the Debtors’ liquidity constraints forced the Complex to operate at less than 50% of capacity on average. As a result, the Debtors were unable to fully capitalize on the stronger pricing environment before prices began reverting toward historically normalized levels. The Debtors concluded that additional capital to restore production, together with a sustainable leverage profile, required a long-term balance-sheet solution.
• Emergency Bridge Financing. As liquidity tightened and debt-service obligations approached, the Debtors negotiated with shareholders and existing lenders, including Braskem and Inbursa, for additional financing. On October 22, 2025, Inbursa provided $34.0mn of emergency financing through an amendment to the senior secured term loan, providing short-term stability while restructuring discussions continued. Liquidity deteriorated further in early 2026, threatening the Debtors’ ability to continue operations and preserve sufficient runway to negotiate a restructuring. Braskem Netherlands subsequently provided $25.0mn of emergency funding through an amendment to the secured PE facility on March 3rd and an additional $101.0mn through the working-capital facility beginning March 25th. The resulting $126.0mn of funded 'Emergency Braskem Bridge Facilities' enabled the Debtors to continue paying employees and suppliers, maintain their facilities and negotiate the prepackaged RSA and Plan rather than face what the Debtors describe as a value-destructive liquidation.
• Debt Service Obligations. As of the Petition Date, the Debtors had approximately $3.6bn of outstanding principal debt. To preserve liquidity while restructuring negotiations were underway, Braskem Idesa stopped making certain scheduled interest payments, including payments on the 2029 senior secured notes in November 2025 and May 2026, the 2032 senior secured notes in February 2026 and the senior secured term loan in January, April and July 2026. The Debtors also defaulted on interest obligations under the working-capital facility. The senior secured noteholders and term lenders did not accelerate their obligations or exercise remedies, while the working-capital lender agreed to forbear through August 17th. By the Petition Date, the Debtors had more than $180.0mn of accrued and unpaid interest. At the same time, they were managing accounts payable by prioritizing payments tied to the quickest conversion of inventory into sales or necessary to avoid operational or legal disruption, while also negotiating customer prepayments to accelerate cash receipts. Despite those measures, payables remained more than 150 days past due and the Debtors said significant liquidity pressure continued to threaten operations.

Prepetition Indebtedness

As of the Petition Date, the Debtors had approximately $3.6bn of outstanding principal debt, before more than $180.0mn of accrued and unpaid interest.

• Senior Secured Term Loan. The Debtors are party to an April 2025 $95.0mn senior secured term loan facility with Banco Inbursa, S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa serving as administrative agent. An October 2025 amendment increased the maximum commitment to $180.0mn and provided approximately $34.0mn of additional emergency liquidity. As of the Petition Date, approximately $129.0mn of principal was outstanding, bearing an average effective interest rate of 11.1%. The facility is secured on a first-lien basis and ranks pari passu with the senior secured notes in the shared collateral.
• 2029 Senior Secured Notes. Braskem Idesa issued $900.0mn of 7.450% senior secured notes under a December 2019 indenture with Deutsche Bank Trust Company Americas as trustee, paying agent and transfer agent. The notes mature November 15, 2029. The full $900.0mn principal amount remained outstanding at filing and ranks pari passu with the term loan and 2032 notes in the shared collateral.
• 2032 Senior Secured Notes. Braskem Idesa issued $1.2bn of 6.990% senior secured notes under an October 2021 indenture with The Bank of New York Mellon as trustee, paying agent and transfer agent. The notes mature February 20, 2032, and the full $1.2bn remained outstanding as of the Petition Date.
• Working Capital Facility. Braskem Idesa entered into a March 2026 working-capital credit agreement with Braskem Netherlands. The original $51.0mn commitment was increased to $101.0mn in May and to $150.0mn on August 15th. As of filing, $101.0mn was outstanding at an average effective interest rate of approximately 10.5%.
• Secured PE Facility. Under a manufacturing and distribution arrangement with Braskem Netherlands, Braskem Idesa received a $42.0mn advance in August 2025 bearing SOFR plus 4.50% and due December 31, 2027, followed by a $25.0mn advance in March 2026 bearing SOFR plus 6.90% and due December 31, 2028. The Petition Date principal balance was $67.0mn.
• Subordinated Shareholder Loans. Braskem Idesa is borrower under subordinated loan facilities provided by Braskem S.A., Braskem Netherlands and Etileno XXI. The Omohundro Declaration reports approximately $1.2bn outstanding at filing, with the obligations subordinated to the Debtors’ senior obligations.
• Receivables Facility. The Debtors also maintain a receivables purchase agreement under which Crédit Agricole Corporate and Investment Bank may purchase up to $60.0mn of receivables. No amount was due and owing under that facility at filing.
• Letters of Credit. Approximately $30.7mn of letters of credit were outstanding as of the Petition Date, carrying an average effective interest rate of 2.7%. 
• Ethane Import Terminal Financing. Separate from the Debtors’ own $3.6bn capital structure, non-Debtor Terminal Química Puerto México, S.A.P.I. de C.V. finances the Ethane Import Terminal through a project facility comprising up to $408.0mn of term loans and a $32.0mn debt-service-reserve letter of credit facility. Braskem Idesa is a sponsor and support party, and the financing is secured in part by the terminal and Braskem Idesa’s and Advario’s equity interests in TQPM.

The Debtors’ list of 30 largest unsecured creditors includes 27 quantified unsecured claims totaling approximately $66.6mn, with the remaining three entries identified as customer prepayments in undetermined amounts.

The above table is generated based on Court filings, please check against primary sources:

For further detail on the Debtors' prepetition capital structure, see our comprehensive data set.

Key Prepetition Shareholders

Braskem holds 75% of Braskem Idesa’s existing equity through the applicable Mexican security trust, while Etileno XXI holds the remaining 25%. Both shareholder constituencies are parties to the RSA.

The Plan preserves equity participation but materially recuts the ownership structure. Existing shareholders collectively receive 33.3% of reorganized equity pro rata to their existing holdings, while Braskem separately receives a 33.3% funding allocation and senior secured noteholders receive the economic benefit of the remaining 33.3% through the $825.0mn equitization. The press release states that Braskem will remain the majority shareholder and Idesa and its affiliates the largest minority shareholder after emergence.

Top Unsecured Creditors

Liquidation Analysis (see Docket No. 16, Exhibit E for notes)

About the Debtors

According to the Debtors: "Founded in 2010, Braskem Idesa is a Mexican company established through the association of Braskem (Brazil), the continent's largest thermoplastics producer, and Grupo Idesa, one of the leaders in the Mexican petrochemical industry. Together, they developed a petrochemical complex focused on the operation and production of high- and low-density ethylene and polyethylene in the municipality of Nanchital, Veracruz, Mexico."

Corporate Structure Chart