(Recasts to add details on ouster, replacement, background,
share performance throughout)
By Guillermo Parra-Bernal and Alberto Alerigi Jr
SAO PAULO, March 23 The board of Brazilian
steelmaker Usinas Siderúrgicas de Minas Gerais SA
removed Chief Executive Officer Rômel de Souza on Thursday after
several board members accused him of breaching company policy
during negotiations with a subsidiary last year, three people
with knowledge of the matter said.
Seven of Usiminas' 11-member board voted to fire Souza and
replace him with Sérgio Leite, a longtime executive who had a
brief stint as CEO last year, said the people, who requested
anonymity due the sensitivity of the matter. Leite's appointment
has immediate effect, two of the people said.
This is the second time in two years the board has voted to
fire Souza as head of Brazil's largest listed flat steelmaker.
Last May, the board ousted him and appointed Leite as his
replacement. Souza was reinstated weeks later, following a court
A spokesman for Belo Horizonte, Brazil-based Usiminas did
not return calls or messages seeking comment on the matter.
Neither Souza nor Leite were available for comment.
Reuters reported on Wednesday that the board had convened an
extraordinary meeting to discuss Souza's unilateral decision to
tap excess cash from mining subsidiary Musa Mineração Usiminas
SA in November.
One of the people said Souza's alleged breach of the
company's compliance rules was linked to the Musa negotiations.
The original plan collapsed on Jan. 11, but a March 3 accord
between the companies allowed Usiminas to tap about 700 million
reais ($223 million) of Musa's excess cash.
Souza's dismissal has the potential of extending a
2-1/2-year rift between the steelmaker's two top shareholders,
Nippon Steel & Sumitomo Metal Corp and Ternium SA
, one of the people said. Ternium and Nippon Steel are
battling over control of Usiminas, which is wrestling with
Brazil's worst-ever recession and high debt.
Reuters had reported on Jan. 13 that Souza and Musa
President Wilfred Brujin had agreed to the use of the unit's
excess capital without the steelmaker's board permission. The
document that Souza, who is also the chairman of Musa, signed
was a non-binding memorandum of understanding.
Preferred shares, Usiminas' most widely traded
class of stock, shed 0.5 percent to 4.18 reais in late afternoon
trading in São Paulo. The stock is up 2 percent this year.
($1 = 3.1358 reais)
(Additional reporting by Brad Haynes in São Paulo; Editing by