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Samba twist

Brazilian oil company Petrobras was rapped by Aurelius Capital Management over its $54 billion debt

Activist hedge fund Aurelius Capital Management has started turning the screws on Brazilian company Petrobras. The state-run oil company, which is facing serious graft charges against its topmost executives, was to release its results in November but extended the deadline to January 31 to assess potential losses. Aurelius has urged Petrobras’ investors to take stock of its $54 billion debt — covered under US law — and declare the company a technical defaulter as it has failed to declare its results in time. Despite its huge oil reserves, Petrobras risks losing its investment grade debt rating and, given that Aurelius has dragged Argentina to court as well, the Brazilian government will need to mollify the activist group before it’s too late.