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Brazil mulls IPO for state airport agency Infraero: minister
July 5, 2017 / 8:13 PM / 5 months ago

Brazil mulls IPO for state airport agency Infraero: minister

BRASILIA (Reuters) - The Brazilian government plans to sell shares in its airport operator Infraero through an initial public offering, potentially surrendering control of the agency, Transportation Minister Maurício Quintella told Reuters on Wednesday.

The IPO, the latest in a series of reforms and privatizations pursued by President Michel Temer’s administration to bolster investment in Brazil’s aging infrastructure, would come after the sale of some of Infraero’s existing airports to private companies.

Quintella said in an interview that a final decision on the process and whether it would result in handing over control of Infraero to private investors should be reached by the end of this month.

Local media reported earlier this week that the government could downsize or even eliminate Infraero, with officials at odds over whether to dispose of all its stakes in 56 airports.

The sale would provide badly needed revenue to the federal government, which has seen tax collection lag official forecasts as Latin America’s largest economy has recovered at a slower-than-expected pace.

Quintella said the government was also finalizing a plan to invest over 50 billion reais ($15.2 billion) in infrastructure projects, which could be announced as soon as next week.

The so-called “Avançar”, or “Advance” program would direct more than 20 billion reais to transportation ventures, Quintella said, as the government doubles down on efforts to bolster the fragile economic recovery.

The program would entail investments of around 16 billion reais in highways, 1 billion reais in railroads, 1.79 billion reais in ports, 820 million reais in public airports and 400 million reais in waterways.

It would replace an existing infrastructure investment plan put in place by former President Dilma Rousseff in 2007 when she was chief of staff under leftist President Luiz Inácio Lula da Silva.

Economists have said the program had little effect on growth and weighed on public finances as Brazil’s economy slipped into its deepest recession in decades. Rousseff and center-right Temer have slashed its budget repeatedly in recent years to try to curb ballooning public debt and regain investors’ trust.

($1 = 3.29 reais)

Reporting by Leonardo Goy; Writing by Bruno Federowski; Editing by Dan Grebler

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