Debate on Petrobras dividend distribution ‘is underway’, says Haddad

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Asked about a possible change in command of the state-owned company, Haddad stated that he does not discuss this issue with President Lula. Minister Fernando Haddad (Finance) Diogo Zacarias/MF The Minister of Finance, Fernando Haddad, stated this Monday (8) that discussions on the distribution of extraordinary dividends from Petrobras are “under way” and that the Board of Directors of the state-owned company should decide on the topic later this month. In March, Petrobras decided not to pay extraordinary dividends to shareholders, which generated a drop of R$55.3 billion in the company’s market value and created problems for the federal government, the oil company’s largest shareholder. “We are speaking with the directors of Petrobras, with some advisors, so that the president can have peace of mind that Petrobras’ investment plan will not be harmed by a lack of finances. That is not the problem. So this will give security so that the board can now calmly make a decision. But I think it is well on its way,” he declared. Dividends are a portion of the company’s profit that is distributed among shareholders. Not paying dividends is interpreted by the market as a sign of lower profitability for the state-owned company. Extraordinary dividends are those paid in excess of the mandatory minimum. In other words, the company does not necessarily have to pay them. After the negative repercussion of the measure, the Lula government decided to pay part of Petrobras’ dividends, around R$20 billion. Of the total, the government will have access to R$6 billion. Change in command at Petrobras The clashes over dividends are related to a crisis at the state-owned company that could lead to the dismissal of the company’s current president, Jean Paul Prates. Asked about a possible change in command of the state-owned company, Haddad said that he does not discuss this type of matter with President Luiz Inácio Lula da Silva (PT).

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