Americanas' Rial says billionaire backers fully supported 'course correction' (updated)

Banco Santander Brasil SA

17/01/2023 16:18

(Adds values of variable compensation paid to managers, context
and background)
    By Gabriel Araujo and Tatiana Bautzer
       SAO PAULO, Jan 17 (Reuters) - The outgoing chief
executive of troubled Brazilian retailer Americanas SA
 AMER3.SA  said on Tuesday the company's billionaire backers
gave him "unconditional support" after nearly $4 billion in
accounting inconsistencies were uncovered.
    Sergio Rial said that Americanas' reference shareholders,
three Brazilian billionaires who founded 3G Capital - Jorge
Paulo Lemann, Carlos Alberto Sicupira and Marcel Telles - fully
backed him on a "course correction" following the discovery of
the accounting scandal.
    Rial resigned last Wednesday, less than two weeks after
taking the position, on the back of distortions he attributed to
differences in accounting for the financial cost of bank loans
and debt with suppliers.
    Americanas, which is seen liable to repay up to 40 billion
reais ($7.82 billion) in debt earlier than planned, was granted
an injunction protecting it from creditors and setting a 30-day
deadline for it to file for potential bankruptcy protection.
    "We reached the scenario seen in the securities filing with
transparency and reliability," Rial said after his short tenure
as CEO, taking over from former CEO Miguel Gutierrez during the
second half of 2022.
    He is a former head of Banco Santander Brasil SA  SANB3.SA ,
the local unit of Spain's Banco Santander  SAN.MC , where he
still serves as chairman of the board. Santander is one of
Americanas creditors.
    Rial left Americanas alongside chief financial officer Andre
Covre, who had just joined the firm as well.
    "With the initial diagnosis there was an urgent need for a
course correction," Rial added in a LinkedIn post, praising the
board of directors and the reference shareholders for "the
transparency and the unconditional support they gave me."
    "As for my departure, it comes from understanding the need
to make room for the company to restructure itself from a
starting point totally different from that I expected to find,"
said the executive.
    CRISIS MODE
    Shares in Americanas rose more than 10% on Tuesday, but were
still down nearly 77% year-to-date, since Rial announced the
accounting inconsistencies.
    Since then, the company has asked for protection from
creditors, a move questioned by banks; securities regulator CVM
opened three probes to investigate the matter; and two industry
groups have sued asking for reparation.
    After news that company managers sold around 215 million
reais ($42 million) in shares in the months before the
revelation of the accounting problems, markets are looking into
variable compensation of management during the period in which
the accounting problems happened. 
    Documents filed with the securities regulator show
Americanas paid 169.6 million reais ($33 million) in
compensation to managers over the last five years, including a
portion of variable compensation, despite the fact that
Americanas had losses from 2017 to 2020. 
    The company paid last year 516.6 million reais in dividends
related to the results in 2021, according to securities filings.
    ($1 = 5.1180 reais)
 (Reporting by Gabriel Araujo Editing by Louise Heavens and Mark
Potter)
 ((Gabriel.Araujo2@thomsonreuters.com; +55 11 5644 7745;))