January 24, 2018 / 8:26 PM / 2 years ago

UPDATE 1-Brazil's Cemig to name Light's Paroli as chief executive -sources

(Adds background, company declining comment)

By Luciano Costa

SAO PAULO, Jan 24 (Reuters) - Brazilian state-run electricity utility Companhia Energética de Minas Gerais will appoint Luís Fernando Paroli as its new chief executive to speed up a stalled asset disposal program, four sources familiar with the matter said.

Set in motion last year, the plan is designed to help Cemig, as the company is known, cut part of its 12.8 billion reais ($4 billion) debt.

Paroli is currently the CEO of Light SA, which is controlled by Cemig. The appointment could be announced as early as March, two of the sources said on condition of anonymity because they were not authorized to discuss the matter publicly.

In an emailed statement, Cemig said it did not comment on “market rumors.”

Divestments have lagged under the current chief executive, Bernardo Salomão Alvarenga, the sources said, referring to plans to sell 8 billion reais worth of assets in a bid to reduce Cemig’s debt.

So far, the most significant sale was of a stake worth about 772 million reais ($244 million) in power transmission company Transmissora Aliança de Energia Elétrica SA.

Last September, Reuters reported that the Minas Gerais state government had decided to change Cemig’s management, including ousting Alvarenga and three senior executives, after Cemig lost dam contracts and took too long to shed assets.

At the time, the sources indicated the reshuffle was likely to come before the end of the year.

$1 = 3.1594 reais Reporting by Luciano Costa; Writing by Ana Mano; Editing by Peter Cooney

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