Eletrobras shares fell more than 3% after the Attorney General of the Union (AGU) filed a lawsuit with the Supreme Court (STF) requesting a partial declaration of unconstitutionality of the company’s privatization law.
President Luiz Inácio Lula da Silva is one of the signatories of the document sent to the Supreme Court.
The lawsuit aims to review a section of the law that reduces the government’s voting power in the management of Eletrobras.
In a relevant fact released by the company this morning, Eletrobras informed that it became aware of the lawsuit through a notice published on AGU’s website – and not through an official notification.
Direct Unconstitutionality Action (ADI) requires that an article of the law be declared partially unconstitutional.
This part of the law restricts voting rights to shareholders who, individually or collectively, hold more than 10% of the company’s voting capital.
HOW VOTING RIGHTS WORK AT ELETROBRAS
Today, the Federal Government controls almost 33% of the common shares (with voting rights in Eletrobras).
It also has the BNDES/BNDESPar percentage of just over 7% – amounting to 40% of the company’s voting shares.
But by the privatization law, its votes correspond to a 10% limit.
The 10% voting limit, regardless of the shareholder’s stake in the company, was established in the Eletrobras Privatization Law and included in the company’s bylaws as of the beginning of its new management.
Privatized in June 2022, investors paid R$33.7 billion for the control of the former state-owned company.
“The objective of the ADI would be to ensure the right of the Union to vote in proportion to the interest currently held in the voting capital of the company,” Eletrobras said in a statement.“
According to the news, the purpose of the ADI would not be to restructure Eletrobras or change its current legal regime.
In the relevant fact released today, Eletrobras says that “the privatization process was conducted per Law No. 14,182 and the Constitution.”
It also said it “will evaluate the measures that may have to be adopted, aiming to maintain a reliable environment for investments by Eletrobras in the country and for the legal security of all its shareholders and the market in general.”
For the AGU, the 10% limit hurts the principles of reasonableness, proportionality, morality, and efficiency of public administration, as well as causing serious damage to public assets and interests.
With information from Revista Oeste