The Brazilian government signed a decree on Wednesday setting
the terms for a reduction in its stake in IRB-Brasil Re, the
state-controlled reinsurer. The government plans to auction off
to the entity's employees a package of common and preferred
shares of the Rio de Janeiro-based institution worth 2.58
billion reais ($1.25 billion) through Feb. 20, before offering
them to private investors.
The plan is another step in the government's decision to
open the reinsurance market to private investors - a move that
began in 2004 with the gradual privatization of IRB. Apart from
the federal government, Itaú Unibanco Holding SA and
Banco Bradesco SA are shareholders of IRB-Brasil Re,
the gazette added.
Details on the potential offer to investors were not
available in the decree.