Eletrobras looking at capitalizing Treasury advances

SAO PAULO (Reuters) – Brazilian state-run utility Centrais Eletricas Brasileiras SA (SA:) said on Monday it is discussing with the government capitalizing 3.9 billion reais ($950 million) in advances for future capital increases received from the Treasury in recent yeas.

If the operation is agreed to, those loans would become capital and be removed from the company’s debt load.

The proposal comes amid discussions between the management and government on the privatization of Latin America’s biggest power utility by way of new share issues. That would dilute the state’s stake in the company, a plan that has met with opposition from politicians.

Eletrobras said in a securities filing, however, that the management hasn’t taken a decision yet, which will require approval by the executive and the board. It would also need a decree issued by President Jair Bolsonaro.

“If and when that the operations goes ahead, shareholders will have preferential rights,” the company said in the filing.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.