UISA Finance Appeals $146 Million Merrill Lynch Award

| July 22, 2012 | 0 Comments

UISA Finance and Usinas Itamarati SA
appealed a $146 million federal court judgment won in April by
Bank of America Corp.’s Merrill Lynch unit.

U.S. District Judge Richard Sullivan assessed the damages
in April in a breach-of-contract suit against UISA Finance and
Usinas Itamarati involving a derivatives transaction in 2008.
Sullivan conducted a five-day trial without a jury in June 2011.
UISA Finance and Usinas Itamarati filed the appeal today in
federal court in Manhattan.

UISA Finance is the financial arm of Usinas Itamarati, a
Brazil-based manufacturer of sugar and ethanol. UISA and Usinas
are owned by Companhia Itamarati de Investimentos.

Merrill Lynch sued in 2009 seeking $146 million in damages.
UISA borrowed $125 million from Merrill in 2007, according to
court filings. After the loan, UISA made an agreement with the
bank for an interest-rate swap in order to reduce its interest
payments.

When the financial crisis deepened in late 2008, UISA was
unable to provide acceptable collateral to Merrill and the swap
was terminated, according to the judgment. At that time UISA and
Itamarati, the guarantor of the agreement, owed $146 million.

The case is Merrill Lynch Capital Services v. UISA Finance,
09-02324, U.S. District Court, Southern District of New York
(Manhattan).

To contact the reporter on this story:
Chris Dolmetsch in New York at
cdolmetsch@bloomberg.net

To contact the editor responsible for this story:
Michael Hytha at mhytha@bloomberg.net

Filed Under: Credit Card News

Leave a Reply

You must be logged in to post a comment.

Get Adobe Flash player