Brazilian electricity firm Eneva, created by former billionaire Eike Batista and now under the control of Germany's E.ON, said Wednesday it had applied for bankruptcy protection after failing to reach agreement with creditors owed a reported $900 million.
The firm, named MPX when it was part of Batista's one-time business empire before he lost the bulk of a £30 billion paper fortune, said the decision was designed to preserve sufficient funds for the firm to continue operating as it battles overall debts of 8.9 billion reais ($2.3 billion).
The company changed its name to Eneva in September of last year after E.ON took a 43 percent stake. Batista himself retains 20 percent.
Eneva said it was making the application as "the agreement through to last November 21 with the banks holding its debt was not renewed."
If a Rio court allows Eneva's petition the company will have 60 days to come up with a debt rescheduling plan.
The company said it had "taken measures to reinforce its structure," including capital injection and cutting costs.
Eneva operates seven thermal power plants and company figures put annual revenue at 2.0 billion reais ($770 million).
Another three Batista firms have requested bankruptcy protection -- oil firm OGX, now named Ogpar, mining company MMX and naval construction firm OSX.
Flamboyant multimillionaire Batista, 58, once Brazil's richest man and one of the wealthiest in the world, went on trial last month in Rio accused of insider trading and stock market manipulation which could earn him a five-year jail term.