Brazilian Federal Government has made official the inclusion of the state-owned Eletrobras, Correios and Empresa Brasil de Comunicação in the National Privatization Program (PND in the acronym in Portuguese).
The intention to privatize the companies had already been announced by the government last week.
Now, with the formal inclusion in the PND, the National Development Bank (BNDES in the acronym in Portuguese) can continue the necessary processes for the sale of part or all of the shares and assets of the state-owned companies.
To finalize the inclusion of companies in the PND, President Jair Bolsonaro needs to approve the measures by decree.
BNDES plans to start the Eletrobras capitalization project as soon as possible, but to continue with the process, Congress needs to approve a bill in which it authorizes the sale of the state-owned companies. Congress has up to 120 days to analyze the matter. Assuming that the bill is approved by June, the government’s schedule foresees the Eletrobras’ privatization to be completed in February 2022.
Under the privatization model foreseen for Eletrobras, the Federal government, which currently owns 51% of the company, will be a minority shareholder.
The privatization model to be adopted for Correios is not decided yet. The government opted for the total sale of the company instead of the partial sale of the shares – it remains to be defined whether the government will remain a minority shareholder or whether it will sell 100% of the company.
There is still no timetable for Correios’ privatization, which has been discussed for years within the federal government and is the subject of protests by state employees. For this reason, the government foresees public debates with society, investors and employees.
In the case of EBC, BNDES will also initiate technical studies on the ideal privatization model. But a schedule has not been released. The end of the company is not ruled out if studies indicate that the state company will not attract private initiative.
EBC currently depends on the resources of the National Treasury. In 2020, the state-owned company had BRL 454.9 million in revenue, but expenses were BRL 543.4 million.