Brazil’s Oi said it has asked the court that is overseeing its bankruptcy case for permission to sell its stake in Timor Telecom, a phone carrier in East Timor.

Canadian communications investment fund Investel Capital has offered to pay $36m for Oi’s share in Timor Telecom and also cover the $26m in debt that the carrier owes to Oi, the Brazilian firm said in a securities filing.

Oi said any earnings from the sale will go to an account managed by the 7th Corporate Court in Rio de Janeiro as part of the company’s judicial reorganization proceedings. Oi included Timor Telecom among the BRL5.9bn ($1.75bn) in assets it had for sale at the end of Q3 2106.

Oi confirmed earlier this month that it had met with representatives from US private equity firm Cerberus Capital Management but it did not receive a takeover offer. Oi also said it had not received an offer from Egyptian investor Naguib Sawiris.

However, a group of Oi’s creditors said it is in talks with the Sawiris Group and bondholders represented by Moelis & Co to come up with an alternative restructuring plan. The creditors are represented by FTI Consulting, Milbank and Mattos Filho.

Bondholders rejected Oi’s restructuring proposal in September, saying it favored the controlling shareholders over creditors. Oi opened talks with bondholders in April and filed the largest bankruptcy protection case in Brazil in June.