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Brazil To Start A 'Roadshow' To Privatize State Assets

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Brazil To Start A 'Roadshow' To Privatize State Assets

In an attempt to reduce the country’s fiscal deficit, the Brazilian government, now led by interim President Michel Temer, will soon be hosting several investor meetings in an attempt to sell some state assets, Reuters reported.

As per Wellington Moreira Franco, one of the main government officials in charge of attracting foreign investment to Brazil, a round of "roadshows" (as they have been nicknamed) around the world will be used to advertise the assets included in the plan, and the conditions to acquire them. And, while the agent did not specify which assets would be sold, or when the offer would begin, other sources familiar with the issue said the presentations would take place in mid-July.

Related Link: May Inflation In Brazil Hits Highest Point In 20 Years

As stated above, the assets for sale have not been disclosed yet, but people familiar with the matter have postulated Temer wants to dispose of the state’s majority stakes in Petroleo Brasileiro SA Petrobras (ADR) (NYSE: PBR) (NYSE: PBR-A) and power utility Furnas Centrais Elétricas SA, among other state investments.

Several top line analysts and politicians have criticized the privatization wave — "privatization" is almost a bad word for many in Latin America, but Moreira Franco has assured the plan will create new jobs in a struggling Brazil. However, he has not provided an estimate of the amount that could be obtained from the asset sale — which others estimate could stand somewhere between $10 billion and $20 billion.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.

 

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