Eletrobras privatization approved by Brazilian Audit Court

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Brazil's Federal Audit Court on Wednesday voted to approve the privatization of state-run power company Eletrobras (NYSE:EBR) by diluting its controlling stake through a share issue.

The timeline of the offer should be defined by early next week, with the offering is expected to occur by June 15, Reuters reports.

The Brazilian government, which seeks to raise ~67B reais ($13.5B) for its majority stake in the company, wants the Eletrobras (EBR) offer to happen quickly as market volatility may increase as the October presidential gets nearer.

But state development bank BNDES, which owns an 11% stake in Eletrobras (EBR), has reservations about a summer sale, saying it is typically a period of low liquidity.

The Audit Court had delaying its final decision to give one of its members more time to evaluate the process.