On Thursday, Brazil raised 33.7 billion reais (6.5 billion euros) from the sale of Eletrobras shares, as part of the privatization of Latin America’s largest power company.
According to preliminary information, a price of 42 reais (eight euros) per share was set, as part of a process through which Eletrobras offered new shares, while the state reduced its stake from almost 70% to just over 40%. The details of the sale will only be officially revealed by the company this Friday.
The new shares will begin trading on the São Paulo Stock Exchange on June 13, when the State ceases to control the company, completing the largest privatization in the country in more than two decades.
The offer, the largest of the year in the country and also one of the highest in the world in 2022, was open to investors, both domestic and foreign.
The Government also allowed the purchase of shares through resources from the so-called Severance Compensation Fund (FGTS), to which every Brazilian has access only in the event of dismissal or the need to buy their own home.
According to the financial newspaper Valor Economico de São Paulo, around 370,000 workers used part of the FGTS to buy Eletrobras shares, a number that exceeds the 248,000 who did so in 2000, during the offer of the state oil company Petrobras, but below the 582 thousand in 2002, with the privatization of the mining company Vale.
The approval process for the privatization of Eletrobras required negotiations for six years and concluded last week when the Federal Accounts Court (TCU), the Brazilian state’s control body, gave final approval for the sale.
The privatization of this giant of the electricity sector will be the first privatization of the Government headed by President Jair Bolsonaro, who since taking office has defended a liberal economic policy with an emphasis on privatization and concessions to reduce the size of the State.
The process of privatization of Eletrobras will guarantee the Brazilian government the possession of ‘golden share’ shares, which reserves the power of veto in the company’s strategic decisions.
The model also excluded the sale of Eletronuclear, the subsidiary that operates Brazil’s three nuclear plants, and the Itaipu hydroelectric plant, which Brazil shares with Paraguay.
Eletrobras, founded in 1962 and responsible for a third of electricity generation in Brazil, owns almost half of the country’s transmission lines, with a combined extension of more than 70,000 kilometers of transmission lines and an installed generation capacity of about 50 thousand megawatts (MW).
Source: Observadora
