November 7, 2019 / 11:52 AM / 3 months ago

Eletrobras gets Bolsonaro approval for 9.9 billion reais capital increase

SAO PAULO (Reuters) - Brazil’s state-run power company Centrais Eletricas Brasileiras SA (ELET6.SA) said that President Jair Bolsonaro had approved a capital increase of up to 9.9 billion reais ($2.42 billion) that the company’s board was seeking.

Shareholders will consider the increase at an extraordinary general meeting, scheduled for 14 November, the company said in a filing late on Wednesday.

Eletrobras said the capital increase had nothing to do with a proposed privatization of the company.

Bolsonaro signed a bill on Tuesday for the privatization of Latin America’s largest power company and a sale of major state asset that must be approved by Congress.

The legislation may face strong resistance in Congress because the government dropped the idea of maintaining a golden share in Eletrobras that would give it a veto over any decisions the company makes after it is sold. Many lawmakers see this as necessary to guarantee the country’s security.

Reporting by Luciano Costa. Editing by Jane Merriman

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