Cade (Administrative Council for Economic Defense) should allow this Wednesday (21) the reversal of a decision that forced CSN (Companhia Siderúrgica Nacional) to sell shares it held in competitor Usiminas.
The reversal is defended by CADE’s General Superintendence and, according to advisors to the councilors heard by the Sheetmust receive approval from the members of the court.
When the case was decided by Cade, in 2014, CSN, which belongs to businessman Benjamin Steinbruch, owned 17.4% of the share capital of Usiminas. There are 15.1% of common shares (with vote) and 10% of preferred shares. According to the decision, this share had to fall to 5% by 2019.
However, the company obtained from Cade in 2019 more time to sell the shares, claiming that the price of the shares was at a very low level.
In 2019, Cade granted another three years for this process to be completed and the company signed a Term of Commitment with the court guaranteeing that it would not use this participation for votes in the meetings or veto in cases of strategic decisions.
About ten days ago, CADE’s General Superintendent, Alexandre Barreto, in a review of this case, determined that the sale of the shares no longer needs to be carried out, provided that the company continues to fulfill its commitment not to exercise political rights with the .
Usiminas took a stand against the decision and, behind the scenes, is considering going to court if the court does not modify Barreto’s order — something that, according to members of Cade, should not be confirmed.
People who follow the discussions at CADE say that Barreto made the decision based on other processes with similar decisions.
According to his opinion, in the last three years, there has been a turnaround in the steel market with the pandemic and the retraction in consumption in China, the main buyer.
Furthermore, a sale of this magnitude would lead to a forced drop in Usiminas’ market value on B3, the São Paulo Stock Exchange.
Even so, CSN sold a small slice of these Usiminas shares (4.1% of the share capital) over the past few years. It currently owns 12.9% of the competitor’s capital.
This Tuesday (20), Usiminas filed a petition with Cade against the decision. In the document, the company states that a court decision could not be reversed by the General Superintendent.
It also states that Cade gave too much time for CSN to plan the sale, without possible losses. Furthermore, he would not have acted as a “pure investor”, entering into legal disputes with Usiminas and its shareholders.
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