A change of CEO of petrochemicals Braskemannounced this Monday morning (4), took the market by surprise. And it was understood as a sign that Emilio Odebrecht – controller of Novonormain shareholder of Braskem – want to increase your influence about the direction of petrochemistry. As a consequence, it reinforces the idea that the sale of Braskem should not happen anytime soon.
Novonor is Braskem’s majority shareholder, with a 38.3% share of the total capital. Already Petrobras it owns 36.1% and another 25.6% is spread across the market. However, the then former Odebrecht company gave this batch of shares as collateral for a debt contracted with five banks – Itaú, Bradesco, Santander, Bank of Brazil e BNDES – between 2014 and 2019. For years, banks have been trying to sell this stake as a way of recovering the resources, currently estimated at R$15 billion. Braskem’s market value, however, is around R$13 billion.
Em relevant factBraskem announced this morning the replacement of Roberto Bischoff, in the position for less than two years (he took over the position in January last year), for Roberto Paraiso Ramos, who was vice-president of the petrochemical company in 2002. This is the third Roberto in the role of CEO in a period of almost four years: in 2020, Roberto Simões took over the role, and was replaced by Bischoff three years later. Before Simões, the CEO was Fernando Musa, who remained in the position for ten years.
In the view of sources close to the company, heard by the InvestNewsRamos is an executive with an “Odebrecherian” profile – with a long history with Emílio. And therefore, he would be much more willing to follow the entrepreneur’s guidance to deal with the company’s different challenges. This is why the movement suggests that the effort to sell Braskem may have even gone back to square one.
Ramos, who is now close to 75 years old, was vice-president of Braskem between 2002 and 2010, a period in which the Ethylene XXI Project was implemented in Mexico. He also served as president of Ocyan, formerly Odebrecht Óleo e Gás, sold in December 2023 to the American EIG.
Like Emílio, Ramos was investigated by Operation Lava-Jato. The executive was arrested in 2016, in the 26th phase of the operation, known as the “Xepa phase”, which investigated a division at Odebrecht aimed at controlling bribe payments. He was never formally charged.
Swap-swap
The recent changes in command are attributed by interlocutors close to the company to the worsening of the company’s financial performance. The permanent state of “for sale” and the negative cycle of the global petrochemical sector have been affecting the company for several quarters.
In the second quarter of this year, the company recorded a loss of R$3.736 billion, 385% higher compared to losses of R$771 million in the same period in 2023. The result was worse compared to the three months immediately previous, when it had been found loss of R$1.345 billion, according to the quarterly balance sheet released by the company.
At the same time, Braskem has been suffering from the effects of the collapse of a rock salt mine in Maceió, in December 2023, causing the sinking of five neighborhoods and forcing more than 50 thousand people to leave their homes. The company has already paid more than R$9 billion in compensation.
Sale suspended?
The change of command at Braskem, in the view of experts who follow the company, is a symptom of the negative effects caused by the delay in defining the sale of its control. But it could also be an indication that the business is not likely to exit anytime soon.
Large companies, both Brazilian and foreign, have already expressed interest in buying control of Braskem. Only in 2023 did the company receive offers from the petrochemical company Uniparfrom the group J&F and from Adnoca state-owned oil company in the United Arab Emirates. What made the talks unfeasible was, according to sources, a certain intransigence on the part of the banks in relation to the price offered. More recently, the prospect of a partnership with Petrobras – which signaled its intention to remain in the business after the sale of control – would also have made the operation unfeasible.
In August, according to the InvestNews reported, Novonor forwarded a plan to try to end the imbroglio. The idea was to transform creditor banks into co-controllers of Braskem. In other words, they would become the owners of the Braskem shares that belong to Novonor and that were given to the banks as guarantee for the debt.
The problem is that, today, the company is worth less than its debt. Furthermore, in the plan presented, the idea is that Novonor would remain with a small slice of Braskem, something that has been rejected by banks. Negotiations did not progress.
