Brazil government appoints new Eletrobras CEO, ignoring headhunter suggestion

FILE PHOTO: The logo for Eletrobras, a Brazilian electric utilities company, is displayed on a screen on the floor at the New York Stock Exchange (NYSE) in New York, U.S., April 9, 2019. REUTERS/Brendan McDermid

SAO PAULO (Reuters) - The Brazilian government has appointed lawyer and economist Rodrigo Limp Nascimento as CEO and board member of state-controlled power company Centrais Eletricas Brasileiras SA, according to a Thursday filing, ignoring a hired headhunter’s recommendation.

Limp will replace Wilson Ferreira, who quit in January over what he called a lack of political support in Congress for privatizing the company.

The nominated CEO is currently secretary of electric energy at the Ministry of Mines and Energy and was a director at Brazilian power regulator Aneel.

Eletrobras said Limp had not been appointed by a headhunter firm it had hired to pick the new CEO, as the government decided to name him directly.

Because of this Mauro Cunha, a board member appointed by the government, resigned. In a letter, Cunha said the board of directors ignored the fact that the headhunter firm had not recommended Limp as CEO.

Still, investors welcomed the nomination, with Eletrobras shares rising 1.5%, outperforming Brazil’s benchmark stock index.

“While some took the appointment of Mr. Limp as negative for Eletrobras’ corporate governance, we could not be more pleased,” said analysts at Bradesco BBI.

They said the appointment is an indication that the government is fully focused on privatizing the company, considering Limp’s previous support for such a move during his time at the Ministry of Mines and Energy.

Reporting by Carolina Mandl and Luciano Costa; additional reporting by Paula Laier, editing by Nick Zieminski and Kirsten Donovan