Bankruptcy? Livraria Cultura manages to suspend first instance decision

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Cultura Bookstore

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Ana Carolina Silva

De Splash, in São Paulo

25/09/2020 21h12

The São Paulo Court of Justice granted Livraria Cultura a suspensive effect for the decision published in the lower court on the 18th, which threatened to declare bankruptcy if the company did not prove compliance with the recovery plan.

The suspensive effect was signed by the judge Manoel de Queiroz Pereira Pants, but the collegiate of the TJ-SP will still make a decision on the appeal requested by Cultura.

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Therefore, the Justice considers that the suspension is temporary and it is still possible that the company has declared bankruptcy.

culture bookstore - Paulo Fridman / Corbis via Getty Images - Paulo Fridman / Corbis via Getty Images

Cultura Bookstore, in São Paulo

Image: Paulo Fridman / Corbis via Getty Images

Cultura has a debt of about R $ 285 million and tries to present a new recovery plan, but the votes of two creditors are a matter of debate: they would have intended to vote in favor of the new plan, but their votes were counted as contrary.

The company says that the first instance judge, Marcelo Sacramone, erred in not taking this into account.

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According to the lawyers – led by Fabiana Solano -, the pandemic of the new coronavirus worsened the financial crisis experienced by Livraria Cultura’s network in different states of Brazil.

As of March 2020, Livraria Cultura suffered abruptly from the impacts of the pandemic and had all its stores closed compulsorily for more than 4 months, which caused an abrupt drop of more than 73% of its gross sales (if compared to the same period of the year 2019).



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