Petrobras ‘Reverse Privatization’ Looms on Brazil

[Judi Lynn]

Petrobras ‘Reverse Privatization’ Looms on Brazil
September 23, 2010, 1:32 PM EDT
By Peter Millard

Sept. 23 (Bloomberg) -- Brazil is reclaiming part of the Petroleo Brasileiro SA stake it sold to investors a decade ago in a record $78 billion share sale today.

The government will boost its stake in Petrobras, Latin America’s second-largest company by market value, to as much as 55 percent from 39 percent now, Adriano Pires, head of the Brazilian Center for Infrastructure, a research group based in Rio de Janeiro, said yesterday in a telephone interview.

Petrobras slumped 29 percent this year, the second-worst performing major oil stock after BP Plc., on concern the sale will cut earnings and boost state interference after the company discovered the largest oilfield in three decades. The Petrobras transaction signals President Luiz Inacio Lula da Silva is seeking a greater role for the state in the economy before the likely election of chosen successor Dilma Rousseff next month.

“Many are worried Petrobras is really becoming a policy arm of the Brazilian government,” Harold Sharon, who helps manage $100 billion including Petrobras shares at Lord Abbett in Jersey City, said in an interview. “As they sit back and look at this entire development, it looks far too interventionist.”

Petrobras is planning to sell as many as 2.718 billion common shares and 1.983 billion preferred shares. The government is buying about $42.5 billion-worth of stock in return for the right to develop about 5 billion barrels of reserves. State-run financial institutions such as the BNDES development bank will likely buy additional shares for cash, UBS AG said Sept. 21.

More:
http://www.businessweek.com/news/2010-09-23/petrobras-reverse-privatization-looms-on-brazil.html

[Peace Patriot]

1. Yup, "entirely too interventionist"...

...for "Lord Abbett in Jersey City."

“'Many are worried Petrobras is really becoming a policy arm of the Brazilian government,' Harold Sharon, who helps manage $100 billion including Petrobras shares at Lord Abbett in Jersey City, said in an interview. 'As they sit back and look at this entire development, it looks far too interventionist.'” --from the OP

:rofl:

But they are not alone. The chorus of ponzi schemers, banksters, roulette players and thieves...um, Wall Street...sound rather like the whiney gangsters they are. Here is what they really object to...

---

"Lula is strengthening control over the domestic oil industry after the Tupi discovery in 2007, the largest find in the Western Hemisphere since Mexico’s Cantarell in 1976. Lula says Brazil is relying on the country’s oil wealth to help raise the nation’s 192 million people out of poverty." --also from the OP

:applause: for Lula! And Dilma's going to win! :bounce: