August 20, 2019 / 12:00 PM / a month ago

Shares in Brazil's Oi sink after reports shareholder seeks to change CEO

SAO PAULO (Reuters) - Shares in Brazilian telecoms carrier Oi SA posted heavy losses on Tuesday, after media reports that its largest shareholder, GoldenTree Asset Management, is seeking to replace Oi’s Chief Executive Officer Eurico Teles.

Brazilian newspaper O Estado de S. Paulo reported earlier on Tuesday that GoldenTree, which holds a 14.5% stake in the company, sent a letter to the board saying Oi needs a CEO “that may execute the operational restructuring recently proposed,” the paper said, mentioning the letter was dated Aug. 16.

According to the media outlet, Oi Chairman Eleazar de Carvalho has proposed Rodrigo Abreu, a member of Oi’s board since September 2018, for the job. Abreu formerly served as CEO for rival TIM Participações SA.

Newspaper Valor Econômico also reported GoldenTree wants to remove Eurico.

Oi common shares were trading down 21% on Tuesday at 0.79 real, while preferred shares were falling 12% at 1.10 real.

Oi filed for Latin America’s largest bankruptcy protection proceeding three years ago, and asset managers are now its largest shareholders after the conclusion of a debt-for-equity swap.

Oi declined to comment. GoldenTree did not immediately respond to a Reuters request for comment.

Reporting by Tatiana Bautzer and Gabriela Mello; Editing by David Gregorio and Nick Zieminski

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