(Bloomberg) -- Creditors of distressed Brazilian retailer Americanas SA approved a restructuring plan to overhaul 50 billion reais ($10.3 billion) of debt in a key step to applying a recovery plan nearly a year after its sudden implosion due to a multi-year fraud.

With more than 97% of banks, bondholders and suppliers represented at the virtual meeting, the creditors gave the company the green light to proceed with the plan that envisions a capital injection of 24 billion reais in 2024 and recovery rates close to 30%.

The stock gained as much as 7.8% in Sao Paulo trading to 0.97 reais a share.

Brazil’s wealthiest and most iconic businessmen billionaires Jorge Paulo Lemann, Carlos Sicupira and Marcel Telles are the largest shareholders of Americanas and have agreed to inject 12 billion reais into the company as part of the recovery plan. They’ve already put up 1.5 billion reais as part of debtor-in-possession financing and will disburse another 3.5 billion reais shortly after the plan’s approval, chief financial officer Camille Loyo Faria said in the assembly on Tuesday. 

The restructuring agreement should allow Americanas to turn the page and begin to focus on its plan to preserve the firm’s brick-and-mortar retail business while weighing offers to eventually divest certain assets. The capital increases mean that Lemann, Sicupira and Telles could end up with a stake as high as 49.3% in the restructured company, Faria said. There will be a three year period where they vow not to sell shares, she said.

“This is an attempt to order Americanas’ capital structure and to pave a path for all stakeholders,” chief executive officer Leonardo Coelho said during the assembly. “This was carefully planned and debated with all of its nuances and this is the best way to fix our liabilities.”

The retailer’s largest creditors, which are the country’s biggest banks, will swap about 12 billion reais of debt into equity to become shareholders once the restructuring is complete. The total debt figure given by the CFO on Tuesday includes intracompany loans with the amount being overhauled closer to 42.5 billion reais.

Americanas will issue new bonds at a steep discount to swap out old ones and offer to make cash payments to others with part of the resources from the capital injection. The company expects its debt load to fall to just below 2 billion reais once the dust is settled. 

Read More: Americanas Gets Majority Support for Debt Restructuring Plan

Americanas, founded in 1929 and one of the country’s most iconic retailers, was thrown into crisis in January after an incoming chief executive officer flagged a massive accounting hole of about 20 billion reais, which doubled the firm’s debt load.

The company quickly sought court protection from creditors to avoid immediate repayment of its debts and proceeded with drafting a recovery plan. Last month, Americanas republished its 2021 and 2022 financial reports showing losses that reached nearly 20 billion reais in the two-year period. 

The fraud, which Americanas alleges was carried out by the previous executive team via supply chain financing and false advertising contracts, was revised up to 25 billion reais.  

--With assistance from Cristiane Lucchesi.

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