Sao Paulo — Energy consultant Adriano Pires has backed out of the Brazilian government’s nomination for him to take the helm at Petrobras, Brazil’s O Globo newspaper reported on Monday, as the latest succession plan at the state-run oil company appears to have fallen apart.
Pires’ decision came a day after soccer magnate Rodolfo Landim declined a nomination to chair the board of Petroleo Brasileiro SA, as the company is formally known.
Pires had been tapped 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.
The government will now need to scramble to find suitable replacements for the two top spots at Petrobras just days before its April 13 annual shareholders’ meeting.
Petrobras did not immediately respond to a request for comment, nor did Pires.
Pires’ nomination had been facing internal compliance-related hurdles at Petrobras, as his consultancy, Rio de Janeiro-based CBIE, advises companies that do business with Petrobras, two sources with knowledge of the matter had previously told Reuters.
An internal compliance committee had also recommended against Landim becoming the next chairman on conflict of interest grounds, said the sources, who requested anonymity to discuss private internal deliberations.
Reached for comment, Landim said that he decided to withdraw from the board nomination in order to dedicate all his energy to Flamengo, the Rio de Janeiro soccer club of which he is president.
Brazil-listed preferred in Petrobras fell about 1% after the O Globo article.
In a note to clients, analysts at Brazil’s Itau BBA 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 nominees to the chairman and CEO positions, arising so soon before the company’s next general shareholders’ meeting, will likely trigger some volatility in the stock this week,” the analysts wrote.
- Reuters (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 JaneiroEditing by Marguerita Choy)
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