Ministry of Infrastructure studies merger of three state-owned companies

The Ministry of Infrastructure has begun a study on the possibility of uniting three state-owned companies: the Brazilian Airport Infrastructure Company (Infraero), the Logistics Planning Company (EPL), and Valec Engenharia, Construções e Ferrovias SA. Minister Tarcísio de Freitas estimated today (11/11) that the evaluation may take between six and eight months to complete. The process could take place next year.

“It’s an embryonic thing, we see that there is some overlap between the activities of these companies. We can eventually have these activities in one company, with only one administrative area. So, there is a possibility, in this format, to do the same thing with more efficiency and less cost,” said the minister, who met with businessmen in Rio de Janeiro, at a lunch hosted by the Spanish Chamber of Commerce in Brazil.

The merger would take advantage of the staff of the three companies and would not lead to layoffs, according to Freitas. The minister said the study seeks to reduce spending, increase efficiency, and is not intended to prepare companies for privatization.

“If we realize further ahead, in the future, that this company generates a lot of value and it is something that may be the object of the private market, we might later also think about privatization, but that is not the idea in the present moment.”

Freitas stated that the challenge is to know whether the model is really the most appropriate. He believes that if the hypothesis is confirmed, the merger could happen quickly, since the Union is the sole shareholder of the three companies.

In an interview with journalists, the minister also defended the merger of three funds managed by the Ministry of Infrastructure. In Tarcísio de Freitas’s assessment, the junction could create a stronger fund.

“I would not fail to attend any of the areas and would have stock and financial breath to do much more with what we have today,” he said. According to the minister, the three funds have US$35bn in resources.

Tarcísio de Freitas analyzed that political turmoil in other South American countries, such as Chile and Bolivia, will not have an impact on investors’ interest in Brazil.

“We are being able to show the foreign investor that we have built a good business environment, a friendly environment that respects contracts and where risks are being handled conveniently,” he said. “I’m sure interest in Brazil will remain high.”

Source: Agência Brasil

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