Government will ‘rotate’ to ‘oxygenate’ state-owned councils after impasse at Petrobras, says minister

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Petrobras’ market value fell after the company decided not to pay extra dividends. Fazenda will have a seat on the board of the state-owned company and should nominate Rafael Dubeux. Rui Costa, Minister of the Civil House, in image from 2023 Civil House of Brazil/Disclosure The Minister of the Civil House, Rui Costa, stated this Tuesday (12) that the government will make changes to the boards of other state-owned companies, in addition to Petrobras. According to the minister, the measure aims to “oxygenate” companies’ boards of directors. Costa did not say which state-owned companies will have changes. “We are going to do this rotation in other places, rotating people from one council to another. Even to oxygenate the councils of state-owned companies, we are going to do this rotation with some people. It is not exclusive to Petrobras, we will have to do this rotation in other councils too”, stated the minister. The head of the Civil House gave the statement a day later after President Luiz Inácio Lula da Silva (PT) decided that the Ministry of Finance will occupy one of the six seats that the government has, as main shareholder, on the board of Petrobras. The deputy executive secretary of the Ministry of Finance, Rafael Dubeux Ministry of Finance/Reproduction Probable nominee The deputy executive secretary of the department, Rafael Dubeux, should be nominated. Costa stated that Lula could make other changes to the oil company’s board. Lula defined a vacancy for Finance after meeting on Monday (11) with the president of Petrobras, Jean Paul Prates, and ministers, including Rui, Fernando Haddad (Fazenda) and Alexandre Silveira (Mine and Energy). The meeting was called due to the controversy caused by Petrobras’ position of not distributing so-called extraordinary dividends to shareholders, which brought down the company’s market value. Asked whether the state-owned company will be able to pay the extra dividends, Costa declared that it will be up to the company itself to make the decision. Petrobras: understand the dividend controversy Dividends are a portion of the company’s profit that is shared among shareholders. Not paying dividends is interpreted by the market as a sign of lower attractiveness (profitability) of 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, but they cannot be used for investments either. After Petrobras’ decision last week not to pay extraordinary dividends, the state-owned company’s market value fell by R$55 billion.

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