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UPDATE 1-Brazil's Andrade Gutierrez walks out of Cemig shareholder accord
September 8, 2017 / 1:01 AM / 2 months ago

UPDATE 1-Brazil's Andrade Gutierrez walks out of Cemig shareholder accord

(Adds background, details on capital structure)

SAO PAULO, Sept 7 (Reuters) - In a surprise move, a unit of Andrade Gutierrez SA, a Brazilian infrastructure and energy conglomerate, decided to leave the controlling bloc of Cia Energetica de Minas Gerais SA, putting an end to months of tension with the Brazilian power utility’s largest shareholder.

In a Thursday filing, the utility known as Cemig said that AGC Energia S/A, a subsidiary of Andrade Gutierrez, said it would sell its stake in the company through a bloc trade, without elaborating.

For almost 15 years, Andrade Gutierrez was part of Cemig’s controlling bloc with the Brazilian state of Minas Gerais.

Andrade Gutierrez owns 6.7 percent of Cemig through AGC Energia S/A, while the Brazilian state of Minas Gerais owns 17 percent of the utility’s capital.

Efforts to contact Andrade Gutierrez outside business hours were unsuccessful.

People familiar with the situation told Reuters over the past year that both partners disagreed over plans to reduce Cemig’s debt and dispose of money-losing operations and low-return, non-core assets.

One of the people said earlier this year that the Minas Gerais state wanted to accelerate asset sales as a means to regain market confidence. (Reporting by Guillermo Parra-Bernal; Writing by Silvio Cascione; Editing by Sandra Maler)

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