Invested in Eletrobras? Find out what happens now

Workers who invested part of the balance they have in the FGTS (Fundo de Garantia do Tempo de Serviço) in Eletrobras shares will be informed, until 4 pm on Monday (13), about the amount that will be effectively invested in the privatization mutual fund.

This happens because, although it was possible to reserve shares with up to 50% of the fund’s balance, the total demand exceeded the R$ 6 billion destined to the resources of the guarantee fund.

Market participants, however, say that demand from these investors was close to R$9 billion.

A proportional apportionment will be made among the workers who decided to invest the FGTS and each one will have allocated 66.79% of their respective request, according to the definitive prospectus of the public offering of Eletrobras shares.

In other words, a worker who has set aside BRL 10,000 to buy Eletrobras shares will be able to effectively invest BRL 6,679 in the company, explained a technician from a government agency that is monitoring the process. See simulations made by Sheet with other values, in reais:

For the retail investor who invested directly in the shares, without using the FGTS, it was not necessary to apportion, and the amount reserved will be fully allocated in the offer, according to information disclosed by Eletrobras.

In total, the amount transacted in the share sale operation was R$ 29.29 billion, according to a notice to the market published on Friday (10) on the CVM (Securities Commission) page.

On Thursday night (9), before the official disclosure, market participants familiar with the process spoke of a moving value of R$ 33.68 billion. The value, however, considers the sale of a supplementary lot, which has not yet been exercised by investors.

According to Eletrobras, the number of shares initially offered may be increased by a supplementary lot of up to 15% of the total shares offered, which will correspond to up to 104.6 million shares. The negotiation of the lot, however, will depend on the demand of investors, who have until July 11 to exercise the option of papers in the supplementary lot. The final amount of the operation, therefore, will be known in fact only in a month.

This is the biggest share offering in 12 years in Brazil, since the capitalization of Petrobras in 2010. The government’s share in the electric company is expected to fall from 72% to around 45%.

Check the next steps of the Eletrobras offer

What happens from now on?

According to Eletrobras, until 4:00 pm next Monday (13), investors who have reserved shares with FGTS funds will be informed by the selected institution of the amount to which they will be entitled, already considering the proportional apportionment.

In addition, until 10 am on the settlement date, scheduled for Tuesday (14), investors who made the reservation via FGTS must pay the shares of the privatization mutual funds with the institution chosen to manage the respective fund.

Also on the settlement date, the investor will receive from the financial institution the shares acquired in the offer or the shares of the selected privatization mutual fund.

For the retail investor who invested directly in the shares, without using the FGTS, it was not necessary to apportion, and the amount reserved will be fully allocated in the offer, according to information disclosed by Eletrobras.

How can the worker consult the amount that will be invested?

• Open the FGTS application. If you don’t already have it, download it to your phone.
• Enter your registered CPF and password to enter
• On the home screen, go to “My FGTS” and click on “View Statement”
• It is also possible to make this query by clicking directly on the line where the current company and the total balance appear, for those who are employed
• When accessing the statement, the amount that will be withdrawn will appear with the date of June 14 and with the indication of “Saque Depósito FMP”
• Two withdrawals may appear on the statement. According to Caixa, in case of using the FGTS for shares or for owning a home, for example, two withdrawals are made, proportionally, one of the balance amount and the other of the amount corresponding to interest and monetary restatement.
• Another option to find out the exact amount is to consult the bank or brokerage responsible for applying the FGTS

What about the FGTS money that was not used to buy shares?

The amounts not used in the application will be unlocked, informed Caixa Econômica Federal, which is the manager of the FGTS.

Technically, the reserved resource never left the worker’s account and therefore continued to be remunerated during the reserve period according to the fund’s rules, said a technician familiar with FGTS management.

According to an official document from Eletrobras, however, in case of apportionment, the amounts deposited in excess will be returned to the FGTS without any remuneration, interest or monetary correction.

I can’t track my investment with FGTS. What to do?

Workers who have questions should access Caixa’s official channels, such as telephone 4004-0104, for capitals and metropolitan regions, and 0800 104 0104 in other regions.

When do the shares issued in the offering begin trading?

According to information published by Eletrobras, the trading of ADRs (American Depositary Receipts) on the New York Stock Exchange, in the United States, began on Friday, as well as the period for exercising the over-allotment stock option, which runs until the 11th of July. ELET3 common shares will be traded on B3, the Brazilian Stock Exchange, this Monday (13th).

As part of its privatization process, the largest electric company in Latin America set the value of each of its common shares at R$42.

When will I be able to sell the shares?

For those who invested the FGTS, the shares can be sold after 12 months. But if the worker fits into one of the situations in which the legislation allows the withdrawal of the Guarantee Fund, he will be able to sell the papers before. This is the case, for example, of those who need the money to buy their own home, the worker who is fired without just cause or retires and whoever has three years without deposits in the FGTS (see here the 16 situations).

If he is dismissed without just cause, he will still have a fine of 40% calculated on the entire balance of the company’s account in the fund, also adding up what he invested in Eletrobras.

In addition, the worker who invested part of the FGTS in Eletrobras shares may choose to keep the investment in the shares even if he is fired, retires or enters into another situation of withdrawal from the fund permitted by law.

According to Caixa Econômica Federal, whether or not to redeem the amounts invested in the fund when fired is a citizen’s option. “If the worker is entitled to redeem the FGTS balance for any of the withdrawal hypotheses, the decision to redeem the amount invested in FMP-FGTS is at the discretion of the worker,” says the bank.

Investors who made the reservation without the FGTS money do not have a minimum period of permanence, that is, they can sell the shares at any time.