RIO DE JANEIRO (Reuters) – Shareholders in Brazil’s Petrobras voted on Monday to remove Roberto Castello Branco as CEO, and elect his government-chosen successor to the board of directors, but dissatisfaction among some investors threatens to delay the transition process.
The dismissal of Castello Branco, although widely expected, is an important step in the government’s plan to place Joaquim Silva e Luna, a retired army general with no oil and gas experience, in charge of state-controlled oil producers.
Shareholders also elect eight people to serve on the board of directors, one of whom will represent non-government shareholders. A rejigged board of seven representing the government – the company’s majority shareholder -, three representing market investors and one representing Petrobras employees, the same configuration as the previous company board.
Three members cannot be re-elected and are automatically retained, bringing the total number of board members to 11.
Castello Branco became CEO in January 2019 and won market praise for selling billions of dollars in non-core assets and sharpening Petrobras’ focus on deep sea oil production.
Brazilian President Jair Bolsonaro said in February that he was firing a University of Chicago graduate executive amid a dispute over fuel prices. Castello Branco will remain as caretaker until Monday afternoon.
Bolsonaro chose Luna to lead Petroleo Brasileiro SA, the company’s official title. The career soldier will be selected as chief executive by the new board of directors.
In the securities filing released after the meeting, Petrobras said Board Chairman Eduardo Leal Ferreira had appointed Carlos Alberto Pereira de Oliveira, head of the company’s upstream division, as interim CEO until Luna’s appointment was inaugurated.
The night was not without drama.
At the start of the trial, Marcelo Gasparino, who was elected as the non-government representative at night, called for the meeting to be postponed due to alleged inconsistencies in the separate preliminary vote counts published by the company prior to the meeting. .
In a LinkedIn post, he said if he was elected he would then resign, a move that could provoke another shareholder meeting under Brazil’s securities law, effectively starting the board selection process from scratch.
The rules governing shareholder meetings in Brazil can be Byzantine, even when they are held in person. Various groups of investors have complained about the complicated rules governing Petrobras shareholder meetings.
The company did not immediately respond to a request for comment on Monday evening.
In his post, Gasparino, the newly elected board member, said he would not step down until the board elects a new CEO, meaning Luna’s official appointment to the top seat is still possible in a short time.
In addition, one of the government-appointed board members, Marcio Weber, was elected even after the Petrobras committee recommended on Friday that he not be given a seat on the board citing conflicts of interest because he was an executive until 2020 of a company. who provide services to Petrobras.
It was impossible to reach Weber immediately on Monday night.
Reporting by Gram Slatery and Marta Nogueira; Additional reporting by Sabrina Valle in Rio de Janeiro and Paula Laier in Sao Paulo; Edited by Will Dunham, Peter Cooney and Karishma Singh