‘When you leave, turn off the light’: the 3G way of governing in Americanas

Austerity in spending is part of the culture of all the companies controlled by the trio of Brazilian billionaires Jorge Paulo Lemann, Marcel Telles and Carlos Alberto Sicupira, who are at the head of the private equity company 3G Capital. To the point that, at the headquarters of Americanas, in Rio, one of the companies that were under the control of 3G, the meeting rooms display notices on the door such as: “When leaving, turn off the lights”.

The trio no longer controls Americanas since 2021, when a corporate restructuring was carried out in the company, and they went from controllers, with a 53.3% stake, to reference shareholders, with 29.2%. According to the most recent information from the retailer, however, the trio increased this participation to 31.13% of the capital today. 3G continues as the main shareholder of Americanas – which has just announced an accounting scandal of around R$ 20 billion on its balance sheet.

Other retailer shareholders are investment fund managers: Capital Group (9.91%), TIAA (6.05%) and BlackRock (5.05%). The remaining 47.86% are spread across the B3.

3G Capital is a major shareholder in conglomerates such as AB Inbev, Kraft Heinz and Restaurant Brands International (which owns Burger King). In all of them, according to executives consulted by the Sheetfierce spending control and a hunger for acquisitions is the norm.

Founded in 1929 in Niterói (RJ), Americanas came under the control of the trio in 1982, when they ran the Garantia bank. The old model of department stores underwent transformations, the company underwent restructuring in the late 1990s, invested in e-commerce with a separate company, Americanas.com, and accelerated the number of acquisitions –in the last 15 years alone, added up to 28.

Austerity in spending and hunger for shopping, however, were not enough to guarantee good results for one of the largest retail chains in Brazil. In 2021, the company combined the operations of the digital and physical platform and promoted a simplification of the corporate structure, giving rise to Americanas SA – the new company started to gather the assets of Lojas Americanas and B2W, owner of Americanas.com, Shoptime and Submarino .

All to ensure more transparency in order to attract foreign investors, in a corporate world that is giving more and more weight to the ESG (acronym in English for environmental, social and governance criteria in the allocation of resources). The company now has a single share, listed on B3’s Novo Mercado, which has the highest governance.

At the time, the market reacted well to the announcements. Americanas shares ended the trading session on November 3, 2021 up 6.57%, quoted at R$33.27.

Some analysts, however, already pointed out that, although it was a good start, the fact of changing the role of the all-powerful 3G, from controller to reference shareholder, was not enough to attract more investments to the company. The market was already complaining about the lack of transparency in some aspects of Americanas’ governance.

Now, analysts and investors are appalled at the scandal that surfaced this Wednesday (11), of R$ 20 billion in “inconsistencies” in the balance sheet, related to the payment of suppliers.

A scandal of this size is not exactly new for 3G: in 2019, Kraft Heinz had to make a major adjustment to its balance sheet, after having overvalued the values ​​of its assets, such as brands and group companies, between 2015 and 2018.

According to the former president of Americanas, Sergio Rial, who was only ten days in office until announcing the accounting breach, his focus from now on will be on “restructuring the company’s equity situation, supporting the reference shareholders.”

This morning, in a presentation to investors about what he found in Americanas’ balance sheet, Rial said that it will be necessary to make a capitalization in the company and that the reference shareholders are willing to participate – but that the operation will need to count on all shareholders.

“The magnitude of the problem is unreal. It is very unlikely that anyone would have known about an accounting error of this type for years on end”, says André Pimentel, partner at the consultancy Performa Partners. “Rial himself, in the meeting with investors, indicated that this matter should have been known to the previous management”, says Pimentel, who worked on the restructuring of Americanas in the late 1990s, when he was at Galeazzi & Associados.

Even before the arrival of Rial, for about 20 years, the president of Americanas was Miguel Gutierrez, the trusted man of the 3G trio.