(Bloomberg) -- Grupo Casas Bahia SA shares jumped as much as 21% after the Brazilian retailer filed an out-of-court deal with its main creditors to reschedule the payment of 4.1 billion reais ($801 million) in debt. 

The plan was built with Banco Bradesco SA and Banco do Brasil SA, the main creditors, which hold approximately 55% of the debt in bank loans, according to Casas Bahia’s chief financial officer, Elcio Ito. The rest of the debt is spread out among several local bondholders, with Santander Asset Management and Banco do Brasil’s asset management unit holding significant chunks of debenture notes, according to people familiar with the matter.

“This plan reduces interest rate payments but the debt continues, there was no haircut on the debt,” Ito said in an interview. “There is no immediate deleveraging for the company.” 

Casas Bahia, one of the country’s most popular retail chains, filed for the extra-judicial recovery plan on Sunday. Brazilian retailers have struggled with truckloads of debt, fierce competition from international players, and logistical hurdles. Casas Bahia saw its market value plunge over 98% from 28 billion reais in 2020 to 619.9 million reais. 

The proposal includes a 24-month grace period for interest payments and 30 months for the payment of the company’s main debt. It also includes the issuance of a new local bond, its 10th, with stricter covenants, according to Ito.

Banco do Brasil and Bradesco had provisioned for such risks over the last few quarters and the plan won’t impact the banks’ guidance, according to the people. Both banks and BB Asset Management declined to comment. Santander Asset Management didn’t reply to requests of comments.

Read more: A $10 Billion Debt Wave Hits Brazilian Retailers at Worst Time

Earlier this year, Casas Bahia completed a reprofiling of bank loans and the 9th issuance of local notes, which totaled 1.5 billion reais, according to a regulatory filing.

That “was super important,” said Ito. “But it didn’t work as a long-term solution. We’ve been working, together with banks, to find a solution that is more permanent.”

--With assistance from Leda Alvim.

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