A Eletrobras and the Attorney General’s Office (AGU) stopped negotiating the anticipation of company contributions to alleviate energy tariffs and moved forward on issues related to the nuclear sector and the right to vote in conciliation to end the dispute over the government’s influence in the privatized company .
The news, reported in a relevant fact published this Thursday (5), was seen as positive by analysts, who pointed out the possibility of the company paying more dividends.
“We see the news as very positive not only because it indicates that negotiations are progressing, but also because it may allow the company to pay larger dividends in the near future,” said Itaú BBA, in a note.
Citi stated that the fact that the company does not have to anticipate new contributions to alleviate the cost of energy “eliminates any potential cash disbursements”, giving more visibility to Eletrobras’ cash flow, “which could eventually open space for discussions on dividends”.
Eletrobras’ common shares rose almost 6%, to R$37.13.
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Negotiations dragged on throughout the year
Eletrobras and the Union began discussing at the beginning of this year an amicable solution for the government to withdraw from the action in the Federal Supreme Court (STF) in which it questions the limit of voting rights in the company to 10%, even though it holds more than 40% of the shares ordinary.
One of the conditions on the table was an anticipation of billion-dollar resources owed by the company to the Energy Development Account (CDE), which would help alleviate consumers’ electricity bills. According to a statement on Thursday, conversations on this topic have ended.
What is the CDE
The CDE is a type of “superfund” for the electricity sector, which funds a series of public policies and is funded through the electricity bill. Today, this bill exceeds R$37 billion per year, representing the main charge paid by consumers.
The figure that the government sought to anticipate with Eletrobras had already decreased, since the Ministry of Mines and Energy decided to carry out a securitization operation of part of these resources this year. The objective was to immediately pay off two loans taken out by the electricity sector in the past: the Covid and Water Scarcity Accounts, which were weighing on energy consumers.
In August, the federal government closed an operation with banks to advance R$7.8 billion in receivables from Eletrobras, but the remaining amounts could be advanced if the agreement on the CDE prospers.
The remaining exact values were not detailed. But, before securitization, the totals negotiated in privatization involved more than R$30 billion in the long term. When asked about the amounts, Eletrobras did not immediately comment.
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New topics on the agenda
New points were included in discussions with the government:
- Limit on voting rights
One of them is the “full preservation” of articles in the Eletrobras privatization law and the company’s bylaws, which guarantee a limit of 10% voting rights for any shareholder or group of shareholders.
If this term is accepted, the government will recognize that it is subject to this voting limit, even if it obtains more seats on Eletrobras’ administrative and supervisory boards.
According to a source with knowledge of the negotiations, the company’s board should be expanded from 9 to 11 seats, with three reserved for appointments from the federal government. Currently, the Union has only one advisor.
New conditions were also placed on matters linked to the nuclear area, from which Eletrobras intends to exit.
- Divestment in Eletronuclear
So that Eletrobras can divest from its stake in the state-owned Eletronuclear, the company and the government would coordinate a process to search for a new shareholder.
At the same time, Eletrobras would remain the guarantor of financing contracted in favor of Eletronuclear before its privatization, an amount totaling 6 billion reais.
- Contributions to the Angra 3 project
The parties would also negotiate a review of the shareholders’ agreement to release Eletrobras from contributing resources to the Angra 3 nuclear project, if the government decides to continue with the construction of the plant.
Eletrobras highlighted that, if the negotiation is concluded, a conciliation term must be drawn up that will still need to be approved by the company’s shareholders through an extraordinary general meeting, in which the Union and shareholders related to the government must abstain from voting.
In a note on the topic, AGU stated that “it trusts in the path of dialogue and, together with the company, remains committed to reaching a consensual solution to the case”.
“In ongoing negotiations, the Attorney General’s Office has sought to guarantee legal certainty, ensuring that all issues are resolved comprehensively and definitively, generating stability and confidence for the parties involved,” he added.
