Eletrobras: Losses of those who invested FGTS close to BRL 1 billion – 05/11/2023 – Market

The approximately 370,000 workers who used the FGTS (Senior Severance Indemnity Fund) to invest R$ 6 billion in Eletrobras shares in the company’s privatization process last year have followed the fall in shares since then with apprehension.

Priced in the privatization offer at R$ 42 per share, the company’s shares ended the trading session this Wednesday (10) quoted at R$ 35.93, which corresponds to a devaluation of around 14.5% in the period. In the same period, the Ibovespa rose 1.8%.

Data collected by Einar Rivero, executive responsible for the commercial area of ​​the TradeMap data platform, indicates that investors have already withdrawn around R$ 1 billion from the funds destined for privatization, with the departure of around 40 thousand quotaholders.

Since the end of last year, workers who have invested their FGTS in Eletrobras’ operations via FMPs (Mutual Privatization Funds) also have the prerogative of migrating resources to FMPs for active management created by banks and brokerages, which have a more diversified portfolio.

The accumulated drop in Eletrobras shares represents a loss of approximately R$870 million in relation to the amount contributed by workers with the FGTS in the company’s privatization offer.

For those who invested the FGTS, the shares can be sold after 12 months, in June 2023, therefore. But if the worker falls into one of the situations in which the legislation allows withdrawal from the Guarantee Fund, he can sell the papers beforehand.

This is the case, for example, of those who need the money to buy their own house, the worker who is fired without just cause or retires and who has three years without FGTS deposits (see here the 16 situations).

If you are fired without just cause, you will still have a fine of 40% calculated on the entire balance of the company’s account in the fund, also adding what you invested in Eletrobras.

The losses of the electric company’s shares have increased over the last few days, after actions by the government of Luiz Inácio Lula da Silva (PT) that seek to reverse decisions taken in the privatization process.

At the end of last week, President Lula asked the STF (Federal Supreme Court) to declare part of the Eletrobras privatization law unconstitutional, so that the Union would have a vote proportional to its shareholding in the company.

The request, made by the AGU (Attorney General of the Union), through an ADI (Direct Action of Unconstitutionality), tries to overturn the section of the law that prohibits shareholders from casting votes in excess of 10% of the number of shares. The AGU lawsuit states that the Union retained 43% of the company’s common shares.

The attempt by the Luiz Inácio Lula da Silva government to increase power at Eletrobras raises legal uncertainty in the market and may hinder the privatization of state-owned electricity and sanitation companies, in addition to increasing the volatility of shares of mixed capital companies on the Stock Exchange , in the evaluation of market analysts and fund managers.

On Saturday, President Lula spoke again about Eletrobras and stated that he intends to file a lawsuit questioning the privatization of the company. The Chief Executive criticized limits created in the privatization of the company that make it difficult for it to be renationalized and questioned the remuneration of directors and directors of Eletrobras.

“The directors increased their salaries from BRL 60,000 a month to more than BRL 360,000 a month, and a counselor to organize a meeting earns more than BRL 200,000. It is not possible in a country where 33 million people spend form us to live in a situation like this”, said the president, in a press conference this Saturday (6), in London, after the coronation of King Charles III.