Brazilian government’s choice for next Petrobras CEO withdraws, sources say

The logo of Brazilian state-run oil company Petrobras is seen at its headquarters in Rio de Janeiro, Brazil October 16, 2019. REUTERS/Sergio Moraes/File Photo

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RIO DE JANEIRO, April 4 (Reuters) – Energy consultant Adriano Pires has withdrawn from the Brazilian government’s nomination to lead Petrobras, two sources told Reuters on Monday, as the company’s latest succession plan public oil company. seems to have collapsed.

Pires’ move came a day after soccer mogul Rodolfo Landim turned down an appointment to chair the board of Petroleo Brasileiro SA (PETR4.SA), as the company is officially known.

Pires had been chosen by Brazilian President Jair Bolsonaro as the next chief executive of Petrobras on March 28, following disagreements between the far-right leader and current CEO Joaquim Silva e Luna over the company’s fuel pricing policy. ‘business. Read more

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The government will now have to scramble to find suitable replacements for Petrobras’ top two spots days before its annual shareholders’ meeting on April 13.

Petrobras did not respond to a request for comment, nor did Pires.

Pires’ decision to step down from the management of Petrobras was reported earlier Monday by Brazilian newspaper O Globo. Preferred shares of Petrobras fell 1% after the publication of the O Globo article, but then recouped their losses.

Pires’ appointment has been met with internal compliance hurdles at Petrobras, as his Rio de Janeiro-based consultancy, CBIE, advises companies that do business with Petrobras, two sources previously told Reuters. aware of the question.

An internal compliance committee had also recommended that Landim not become the next president due to conflict of interest concerns, said the sources, who requested anonymity to discuss private internal deliberations.

Contacted for comment, Landim said he had decided to step down from the board appointment in order to devote all his energy to Flamengo, the Rio de Janeiro football club of which he is president.

In a note to clients, analysts at Itau BBA in Brazil maintained their “outperform” rating on Petrobras shares given what they described as strong fundamentals, but said uncertainty at the top would create negative noise.

“This uncertainty regarding the candidates for the positions of President and CEO, which comes so shortly before the company’s next general meeting of shareholders, will likely trigger some volatility for the stock this week,” the analysts wrote.

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Reporting by Gabriel Araujo in Sao Paulo and Rodrigo Viga Gaier in Rio de Janeiro; Writing and additional reporting by Gram Slattery in Rio de Janeiro Editing by Marguerita Choy

Our standards: The Thomson Reuters Trust Principles.

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