A worker may use FGTS funds to purchase shares in privatized Eletrobras – 10/19/2021 – Market

The PPI (Partnership Investment Program) Board, Tuesday (19), approved a model Privatization of Eletrobras identified by the BNDES (National Bank for Economic and Social Development), which will allow, for example, workers to use resources from FGTS To buy shares in the company. The total limit will be R$6 billion and the minimum investment is R$200.

Individuals will be able to purchase a minimum of R$1,000 in Eletrobras shares that will be offered in B3, Sao Paulo Stock Exchange. The ceiling in this case will be R$5,000.

Company employees will have a reserved 10% share of the total offer if they are interested in making this investment.

According to BNDES President Gustavo Montanzano, the primary (initial) offer will be R$23.2 billion. If there is a second problem, then the value is determined so that the share of the union in Eletrobras is 45% of the capital.

The Executive Secretary of the Ministry of Mines and Energy estimates that the supply will occur in the first quarter of 2022. For this, other stages of the process, such as modeling approvals by the TCU (Court of Accounts) from the Union) and corporate changes in Eletrobras subsidiaries, which will control directly to the federal government.

According to the rules, no shareholder can vote with more than 10% of their shares, and there will be provisions to avoid the concentration of votes by investor groups (a mechanism known in the financial market as a poison pill).

Part of the resources of this offer will be allocated to supply the CDE (Energy Development Account), which is responsible for the lower tariffs. It is estimated that this amount will reach R$29.8 billion. But in practice, Montezzano stated that the process would be neutral from a tariff point of view.

“It will neither increase nor decrease,” he said.

Another part of the resources will be devoted to revitalizing the hydrographic basins (R$6.7 billion) and energy improvement projects in the North (R$2.1 billion) over the next few years.

BNDES also estimates that this project will allow the privatized company to invest an average of R$12 billion annually in power generation business, as opposed to R$2 billion currently.

Part of the process is still to be expected Corporate changes in the Electronuclear, in charge of nuclear power plants in Angra. This company will no longer be under the control of Eletrobras and will be transferred to the union through another company created, ENBPar, according to Montezano. It will take R$3.5 billion from Consortium in the new company and Eletrobras will have to inject R$1.4 billion to completely dilute its involvement.

There will also be an obligation for Eletrobras to partner with this new state-owned nuclear company in raising funds to complete the Angra 3 plant, a work that has been blocked due to a corruption scheme investigated by Operation Lava Jato.

Terms agreed by the PPI Board still need approval from the TCU, which can suggest changes.

Another project that was guaranteed to move forward was the Rio-Valadares Highway Concession, which connects Rio de Janeiro with Minas Gerais.

This work should consume R$8.6 billion in investment over the next 30 years and bring in a combination of low tariff and grant value to determine the winning bid, said PPI’s private secretary, Martha Silier. If there is a tie in the proposals, the proposal that makes the lowest amount and highest concession to the union will win.

Also according to the minister, PPI has already sold 115 projects at auction since the start of Jair Bolsonaro’s government, which has attracted R$550 billion in contract investments during the contracts.

This year, two auctions Highways (Novadotra and BR-381), port leases, mineral exploration rights, transmission lines, and oil transportation groups, as well as 5G phone frequencies.

“We are expected to close this year with 45 new assets and R$295 billion in contracted investments,” Cellier said.