Who is the billionaire who won the government in the Petrobras board election

The Brazilian billionaire who won the government in the election for the Petrobras board of directors is a recluse, considered a conservative investor and likes to say that company owners have to be part of the collegiate that defines their course.

Listed by Forbes magazine as the 18th largest fortune in Brazil, João José Abdalla Filho, 76, is called “Brazil’s most unknown billionaire”. He does not usually attend social columns, public events and does not give interviews.

He owns Banco Clássico and has an estimated net worth of US$ 2.8 billion (approximately R$ 13 billion, at current prices), the result of the investment of funds inherited from his father, the São Paulo industrialist José João Abdalla, who died in 1988. .

Known as Juca Abdalla, the billionaire won two seats on the Petrobras board of directors two weeks ago, advancing over a vacancy traditionally occupied by federal nominees.

He himself will occupy one of them. Banco Clássico, one of the largest individual shareholders of the state-owned company, also approved the appointment of lawyer Marcelo Gasparino, who usually represents Abdalla on company boards.

The banker’s advance is the target of criticism from unions, who see in the move a reinforcement in the defense for the privatization of the company, already defended by President Jair Bolsonaro (PL) and by the Minister of Economy, Paulo Guedes.

Banco Clássico is a major shareholder in some of the largest Brazilian companies, such as Petrobras, Vale, Eletrobras and Cemig, and uses the weight of its stakes to ensure a voice on the companies’ boards of directors.

It also has relevant stakes in private companies such as the electric company Engie and the gas distributor Naturgy, generally companies that operate with concessions regulated by the federal and state governments.

Its investment strategy is seen by the market as conservative and long-term, with a preference for companies guaranteed by governments, which are less likely to fail.

Abdalla did not want to speak with the Sheet. His lawyer, Leonardo Antonelli, confirms the perception. “He’s not a market speculator,” he says. Its bet on state-owned companies would be explained by the possibility of unlocking value with better governance or even privatization.

The banker likes to repeat that the “owner” of a company has to be part of its board of directors. The election at Petrobras, says Antonelli, “is a strategy in line with his thinking and which is proving to be effective in defending the best interests of shareholders and in monitoring governance.”

At the meeting held on the 13th, private shareholders won 4 of the 11 seats on the collegiate—six were appointed by the Union and one belongs to a workers’ representative. It is the composition with the smallest number of representatives of the controlling shareholder.

The advance had already been tried, unsuccessfully, in 2021. This time, Abdalla managed to change the voting model so that shareholders could vote individually for candidates and not on a previously established ticket.

With the weight of its shares and the support of other investors, Banco Clássico doubled its participation in the collegiate. For Antonelli, the support of other shareholders “demonstrates the confidence of investors, especially foreigners, in the work that has been developed in recent years”.

Abdalla was already a counselor at Cemig, but he had not yet occupied the collegiate body of one of the two state-owned companies in the Union in which he has a relevant participation. At Eletrobras, the Clássico bank is represented by Gasparino, who is also a board member at Vale.

Focusing on the management of Abdalla’s resources, Banco Clássico had assets of BRL 14.5 billion at the end of the third quarter of 2021, according to the most recent data from the Central Bank. In that period, it recorded a profit of R$ 80.4 million.

The funds that started the bank were generated by his father’s conglomerate of companies, known as JJ Abdalla, in the fields of cement, metallurgy, weaving and sugar cane, among others.

And fattened by the expropriation of land where the Villa Lobos Park is now located, in São Paulo. It was the largest indemnity paid so far for the expropriation of land, worth R$ 2.5 billion, in a highly questioned process at the time.

JJ Abdalla had a career in politics and was the target of around 500 lawsuits, according to a report by the Center for Research and Documentation of Contemporary History of Brazil at FGV (Fundação Getúlio Vargas).

He was arrested twice between the late 1960s and early 1970s for violating labor laws.

Abdalla Filho also tried to get into politics, running as a candidate for deputy senator for Roraima in 2006. At the time, he declared that he had a net worth of R$379,200, the equivalent of R$920,200 today.

His trajectory also has problems in justice: in 2019, he was denounced by the Federal Public Ministry for tax evasion and in 2020, for passive corruption and embezzlement, in case of bribes to a judge for the release of precatories.

Both cases are still pending in court.