Braskem Idesa, S.A.P.I. and two affiliated debtors filed prepackaged chapter 11 petitions on August 17, 2026 in the United States Bankruptcy Court for the Southern District of Texas, Houston Division. The plan, the disclosure statement and a first day declaration from a managing director of the debtors' proposed financial advisor were filed the following day. The restructuring support agreement was executed on the petition date.

The three debtors are Braskem Idesa, S.A.P.I., Braskem Idesa Servicios, S.A. de C.V. and Braskem Idesa Ethane LLC. Terminal Química Puerto México, S.A.P.I. de C.V., a 50/50 joint venture with Advario B.V. that holds the group's ethane import terminal, did not file.

In 2008, facing a deficit in the domestic ethylene production chain, the Mexican government and Pemex Transformación Industrial invited thirty-one Mexican and international petrochemical companies to bid for a long-term raw material contract paired with the construction of a petrochemical complex. A consortium of Braskem S.A. and Grupo Idesa, S.A. de C.V. won the bidding in 2009. The ethane supply agreement became effective in February 2010, and Braskem Idesa was incorporated in Mexico that April.

The complex sits on a site the declaration describes as approximately 200,000 acres at Nanchital de Lázaro Cárdenas del Río, Veracruz, in the Coatzacoalcos region. The declaration characterizes the project as the largest private industrial investment made in the Mexican petrochemical sector in over thirty years and the largest investment made in Mexico by a Brazilian company.

Excess power is sold to the grid. The declaration describes a railyard holding more than 400 hopper cars and thirty tank cars connecting to the major railroad concession in Mexico, twenty-one silos of 500 tons each, a 215,000 square foot warehouse, and a 300,000 square foot external yard capable of storing more than 36,000 tons of polyethylene. Product can be delivered anywhere in Mexico within an average of seventy-two hours.

The company produces approximately fifteen grades of polyethylene. Its customers are described as producers of third-generation petrochemicals manufacturing plastic films for food and industrial packaging, bottles, shopping bags, other consumer goods containers, and household appliances. Since completion, the declaration states, the complex has produced over 7.5 million tons of polyethylene and generated over $9 billion in revenue, and the company ranks among the lowest-cost polyethylene producers in the world.

Equity is held by Braskem Netherlands B.V. at 1,396,953 shares, Etileno XXI, S.A. de C.V. at 465,652 shares, and Braskem S.A. at a single share, out of 1,862,606 fully subscribed and paid shares. Total stockholders' equity as of December 31, 2025 was negative $414 million, consisting of $2 billion in total capital issued against negative $2.4 billion in retained earnings and other items.

The declaration identifies ethane as the largest cost line in the business and the input the complex cannot run without. Under the original supply agreement, Pemex was obligated to deliver 66,000 barrels per day, equivalent to 3,757 tons, for twenty years on a deliver-or-pay basis.

Deliveries fell short. The declaration attributes the shortfall to a combination of factors including a decline in Mexican natural gas production, and reports the delivery history below.

In 2021 the parties amended the agreement. The amendment reduced Pemex's supply obligations by more than 50%, released Pemex from liquidated damages for earlier shortfalls, and secured Pemex's support for construction of an ethane import terminal. Under the amended agreement Pemex supplies 30,000 barrels, or 1,708 tons, per day until that terminal is complete, after which it has no minimum delivery obligation, though the company retains a right of first refusal on available supplies Pemex does not use. Since the beginning of 2026, Pemex has provided approximately 14,000 barrels, or 794 tons, per day. The amended agreement is currently scheduled to expire in 2035, subject to additional extensions.

The company pursued three sources of replacement feedstock.

An overland import arrangement executed in September 2019 with a Mexico City port operator and a cryogenic gas transportation company brought ethane to docks in the port of Coatzacoalcos, into cryogenic tanks, onto trucks, and to the complex by road. Those operations have concluded now that the import terminal is running.

A supply relationship with Braskem Netherlands B.V. began with an open order quantity agreement in February 2020 and was superseded by a term agreement dated December 18, 2023, under which Braskem Netherlands or an affiliate supplies ethane through March 31, 2033. The ethane originates in the United States and is delivered at either the Morgan's Point facility at the Port of Houston or the Beaumont export facility in Texas, with title transferring before export. Outstanding invoices under that agreement stood at approximately $120 million as of the petition date, covering both ethane and supply vessels.

The ethane import terminal, approved in 2021, is held by Terminal Química Puerto México. It has storage capacity of approximately 54,000 tons and transport capability of approximately 80,000 barrels per day, equivalent to 4,554 tons, which the declaration states is more than sufficient for the complex's current total ethane needs. Under two services agreements dated October 31, 2023, each with an initial twenty-year term, the company pays the joint venture an average of approximately $7.4 million per month for storage and approximately $630,000 per month for transportation, both inclusive of applicable value-added taxes.

The declaration attributes the increase to imported ethane costing significantly more than domestic Pemex supply, with additional fixed costs from leasing vessels from related parties and variable per-ton costs subject to additional fees, premiums and customs costs.

On market conditions, the declaration states that since the second half of 2022 the debtors have operated against a sustained industry downturn, narrowed spreads and a constrained Mexican ethane supply. Polyethylene prices doubled in the first half of 2026 on geopolitical factors including conflict in the Middle East. Liquidity constraints held the complex to average utilization of less than 50% over that period, and prices have since fallen toward historically normalized levels.

All amounts are stated in United States dollars, with peso amounts converted at an approximate average of 17.47 Mexican pesos per dollar over the thirty-day period ending July 31, 2026.

The term loans and both note series rank pari passu in the prepetition shared collateral under a second amended and restated intercreditor agreement dated October 20, 2021. The term loan facility carried a maximum commitment of $180 million following an October 2025 amendment, against approximately $129 million drawn. The secured polyethylene facility consists of a $42 million advance payment made under an August 15, 2025 amendment, due December 31, 2027, and a $25 million advance payment made under a March 3, 2026 amendment, due December 31, 2028; the declaration states it may be satisfied by delivery of products or by repayment.

A receivables purchase facility permits the purchaser to buy up to $60 million of receivables, with no amount owing at the petition date. The debtors report a trade base of over 400 vendors with an average of 150 days past due, some unpaid for more than a year.

The non-debtor terminal joint venture is the borrower under an October 31, 2023 credit agreement providing a term loan facility of up to $408 million and a debt service reserve letter of credit facility of up to $32 million, with Crédit Agricole Corporate and Investment Bank as administrative agent and joint lead arranger and Citibank, N.A. as offshore collateral agent. The collateral is the terminal and the equity interests in the joint venture. Braskem Idesa is a sponsor under a related support and share retention agreement.

The terminal project missed certain milestones, causing a default under that credit agreement. The joint venture and its financing parties entered a forbearance agreement on December 30, 2025 that expired April 30, 2026, and a second on July 22, 2026 under which the financing parties agreed not to exercise remedies as to existing specified defaults or any default arising from the chapter 11 filing.

The declaration describes an emergency Inbursa term loan and, separately, emergency Braskem bridge facilities. Together they were meant to create room for an orderly balance sheet reorganization instead of a liquidation that would destroy value.

As of the petition date, the declaration states, holders of both note series and the term lenders had not called a default, accelerated or enforced remedies. Negotiations with Braskem, Inbursa and an ad hoc group of noteholders initially centered on a transaction in which those parties would have extended new money financing, taken a larger multi-tranche roll-up of prepetition debt, equitized a significant portion of remaining debt and held a majority of the reorganized equity. The parties moved off that structure before the filing.

Braskem Netherlands B.V. and Braskem America, or their affiliate designees, agreed to provide a superpriority, senior secured and priming delayed-draw term loan facility of approximately $409 million plus applicable fees and premiums. TMF Mexico Business Process, S. de R.L. de C.V. serves as collateral agent. The three debtors are the credit parties, and the motion states expressly that the non-debtor terminal joint venture is not a guarantor.

The roll-up converts emergency Braskem bridge facility obligations into term loans under the new facility, up to approximately $103.91 million at the interim order and up to approximately $25.98 million at the final order. The interim order provides that the exchange occurs on a cashless, dollar-for-dollar basis.

The commitment fee is 0.50% of $230,000,000 at the interim funding and 0.50% of $49,000,000 at the final disbursement, each paid in kind. The carve-out covers clerk and United States Trustee fees, up to $100,000.00 in chapter 7 trustee fees and allowed professional fees, with a post-trigger-notice cap of $8,000,000.00. A statutory committee, if appointed, receives $50,000 to investigate the prepetition liens. The challenge period runs to the earlier of plan confirmation, sixty calendar days after appointment of a committee as to that committee, and thirty calendar days after entry of the interim order as to all other parties in interest.

On use of proceeds, the motion identifies professional fees and restructuring charges, amounts owed to the lenders, working capital and general corporate purposes, and the costs of administering the cases. The declaration states the debtors expect to deploy the initial $230 million draw to increase production at the complex, nearly tripling utilization from recent lows, and puts the total incremental capital requirement at $350 million across the facility and the new money equity contribution. The facility was approved by unanimous shareholder resolution, including with support from Etileno XXI, before the cases commenced. The court entered an interim financing order on August 18, 2026.

The restructuring support agreement was executed August 17, 2026 among the debtors, Braskem, Inbursa and the ad hoc group of holders of senior secured notes. Those parties hold approximately 79% of the aggregate outstanding value of the debtors' prepetition secured debt obligations.

The plan allocates the reorganized equity in exact thirds, defining each of the Braskem funding, senior secured notes and existing shareholder equity allocations as one third on a fully diluted basis.

Braskem S.A. would receive its allocation in exchange for an aggregate of approximately $486 million, consisting of a roll-up of $131 million of prepetition support financing inclusive of accrued interest through the plan effective date, approximately $283 million in respect of the new money loans inclusive of accrued interest and the commitment fee, and a new money equity contribution of $71 million funded on the effective date. Holders of senior secured notes would receive their allocation through equitization of $825 million of senior secured notes claims. Existing holders would receive theirs pro rata to current holdings, in the form of reorganized Class B shares, as consideration for existing equity interests and post-reorganization support.

The remaining senior secured notes claims and the senior secured term loan claims would receive first lien exit notes issued on the effective date in an aggregate principal amount of approximately $1.6 billion, secured by priming liens on all assets of the borrower and guarantors, subject to exceptions in the exit notes documents. An equity special purpose vehicle would acquire the senior secured notes equity allocation for holders other than Inbursa and issue notes to those holders representing that equity in the form of reorganized Class A shares. Inbursa agreed under the restructuring support agreement to take a separately defined equitization instead.

The debtors describe the result as elimination of more than $920 million of debt from the balance sheet and preservation of approximately 800 direct jobs.

The plan establishes eleven classes. Six are entitled to vote.

Third-party general unsecured claims in Class 8 would be reinstated and paid in full in cash, or otherwise rendered unimpaired under section 1124, with no distribution on any claim already satisfied before the effective date pursuant to a final order.

Class 3 holders would receive a pro rata share of the senior secured notes exit notes allocation and of the equity special purpose vehicle notes. Class 4 holders would receive a pro rata share of the senior secured term loan exit notes allocation. Classes 5 and 7 would be satisfied in accordance with a Braskem commercial claims schedule, a plan supplement document due September 10, 2026. Each subordinated loan in Class 6 would be amended and restated so that its term extends beyond the term of the exit notes, it is subordinated to the exit notes, and all interest is payable in kind; the declaration states those loans already accrued at 7% payable on the same date as principal.

Class 9 and Class 10 would be cancelled or reinstated at the reorganized debtors' discretion. Class 11 interests would be cancelled, with each holder receiving a pro rata share of the existing shareholder equity allocation in reorganized Class B shares. The disclosure statement lists no projected percentage recovery for Class 11 and states in a footnote that holders will receive approximately $486 million in reorganized equity at the stipulated plan equity value.

The disclosure statement states that projected recoveries assume, solely for illustrative purposes, an implied plan equity value of approximately $1.46 billion derived from the $486 million contributed in exchange for one third of the reorganized equity on a fully diluted basis. It states that value is solely a product of the plan's negotiated terms, is not based on a valuation analysis, is not an estimate of trading value, and that no valuation analysis has been prepared in connection with the plan or disclosure statement.

The court entered a scheduling order on August 18, 2026.

Under the restructuring support agreement milestones, a final financing order, approval of the disclosure statement and entry of a confirmation order are required no later than forty calendar days after the petition date. The plan effective date is required no later than fifty-five calendar days after the petition date, subject to automatic extension to an outside date if all conditions other than required regulatory approvals are met and the company and the consenting shareholders are working in good faith to obtain them.

Kroll Restructuring Administration LLC is claims, noticing and solicitation agent. No creditors' committee had been appointed as of the docket reviewed for this report.

The cases are pending as Case No. 26-90762 (CML), jointly administered, before Judge Christopher M. Lopez. Hunton Andrews Kurth LLP and Cleary Gottlieb Steen & Hamilton LLP are proposed co-counsel to the debtors, with Sainz Abogados, S.C. as Mexican counsel. Alvarez and Marsal North America, LLC is proposed financial advisor, Lazard Frères & Co. LLC and Lazard Assessoria Financeira Ltda. are proposed investment bankers, and Hilco Global Mexico is proposed appraisal and valuation services provider. Haynes and Boone, LLP and Davis Polk & Wardwell LLP represent the ad hoc group of secured noteholders. Porter Hedges LLP and Herbert Smith Freehills Kramer (US) LLP represent Inbursa and related parties. Jones Day represents Braskem S.A.

The plan has not been confirmed and the objection deadline has not passed. The following items remained open as of the docket reviewed for this report.

Regulatory approvals

The plan's conditions precedent include obtaining all authorizations, consents, regulatory approvals, rulings and documents necessary to implement the plan and the restructuring transactions. The fifty-five day effective date milestone carries an automatic extension triggered by an outstanding regulatory approval. The documents reviewed for this report do not state when the outside date that extension runs to falls.

The ethane import terminal

The joint venture that owns the terminal is not a debtor. Its financing parties have forborne rather than waived, and the collateral includes the equity interests Braskem Idesa holds in the joint venture. The second forbearance agreement covers defaults arising from the chapter 11 filing.

Plan supplement and unquantified terms

The Braskem commercial claims schedule governing the amounts for Classes 5 and 7 is due September 10, 2026 and was not on file. The Inbursa equitization is defined by reference to the restructuring support agreement and is not quantified in the plan or disclosure statement. The exit notes are stated at approximately $1.6 billion in the declaration and the disclosure statement, and the plan states no amount.

Voting

Classes 3 through 7 and Class 11 are entitled to vote. The 79% support figure in the restructuring support agreement is stated in the aggregate across the prepetition secured debt, and the filings reviewed for this report do not break it out by class or by facility. The voting report is due three days before the combined hearing.