A group of Frigorífico Concepción (FriCon) bondholders has hired Rothschild and Cleary Gottlieb Steen & Hamilton as financial and legal advisors, respectively, ahead of a debt restructuring, according to two sources close to and a source familiar with the matter.

The holders are still in talks with law firms in other jurisdictions, the three sources said.

From the company’s side, the Paraguay-based meatpacker has retained Pantalica Partners as financial advisor, along with law firms in the US, Paraguay, Brazil and Bolivia, the first source close and the source familiar said.

The company is working with Linklaters in the US, and with Diamantino Advogados Associados as Brazilian legal counsel, the same sources said.

Ovelar Abogados was hired as the company’s law firm in Paraguay, and Dentons Guevara & Gutierrez in Bolivia, the first source close said.

The idea is to have a global debt restructuring, and not one focused only on the bonds, the first source said.

Frigorífico Concepción has to repay USD 210.9m in debt in the next 12 months, according to the earnings release in April.

At that time, its vice president Pedro Pascutti said the company was working to reduce this level of debt to USD 50m by the end of June.

Out of the total short-term maturities, USD 58.5m is due between April and June, including a USD 17m principal payment on a facility with Bank of America (BofA).

“With bond prices going down and the BofA loan amortizing, bondholders are afraid of getting screwed,” the second source close said.

The rumor is that it is very likely that the company won’t make the payment on the BofA loan on Monday (8 June), an analyst following the case said.

The BofA facility is guaranteed by FriCon’s export receivables that are held in an escrow account, said the second source close. Defaulting on that loan would be difficult, but it will depend on how the loan is structured, the same source said.

The remaining maturities are debt with banks in Paraguay, Bolivia and Brazil and domestic bonds, as reported.

Frigorífico Concepción’s credit ratings were downgraded to CCC by Fitch and Caa1 by Moody’s in recent weeks amid liquidity concerns.

The company’s USD 300m 7.7% notes due 2028 was traded at 23 on 3 June.

Spokespeople at Frigorífico Concepción, Linklaters, Ovelar Abogados, and Dentons Guevara & Gutierrez did not respond to requests for comments.

A representative for Diamantino Advogados Associados confirmed the firm’s hiring.

Representatives for Rothschild and Cleary Gottlieb Steen & Hamilton also did not respond to requests for comments.

An official at Pantalica Partners declined to comment on the matter.