Brazil to launch public consultations to clear way for Sabesp privatization (updated)

Companhia de Saneamento Basico do Estado de Sao Paulo - SABESP

05/02/2024 17:25

(Adds more details in paragraphs 4-6)
       SAO PAULO, Feb 5 (Reuters) - The government of Brazil's
Sao Paulo state will launch a public consultation process on
Friday regarding new contracts that state-run water utility
Sabesp  SBSP3.SA  will sign with 375 municipalities, an official
told Reuters on Monday.
    The consults mark an important step in the company's
privatization process, the state's secretary of investment
partnerships, Rafael Benini, said in an interview.
    The contracts, which will replace existing ones, will detail
the works and investments in each location and were drawn up in
negotiations conducted by the state with the municipalities over
the last few months. 
        The contractual debate is important for the
privatization process, since it will determine the level of
investments that the Sao Paulo sanitation company will have to
make in each municipality in the future. 
  
        This will determine the size of the primary offering of
shares that will be carried out alongside the secondary offering
which, in turn, will reduce the state's stake in Sabesp's
capital.
  
         According to general guidelines already published by
Sabesp, the new contracts will have the same term as their
predecessors, until 2060, and will bring forward targets for
universalization of water and sewage services. 
  
    

 (Reporting by Leticia Fucuchima; Writing by Steven Grattan;
Editing by Kylie Madry)
 ((Steven.Grattan@thomsonreuters.com;))