May 2, 2018 / 11:30 AM / in a year

Eletrobras reaches initial settlement in U.S. class action case

SAO PAULO (Reuters) - Brazilian state-controlled power company Centrais Eletricas Brasileiras SA (ELET6.SA) said on Wednesday it has reached a memorandum of understanding with holders of its American depository shares to settle a class action lawsuit by paying $14.75 million.

In a securities filing on Tuesday morning, Eletrobras, as the company is commonly known, said the accord is subject to U.S. court approval.

“The agreement is meant to close all the current cases initiated by investors (in Eletrobras) that acquired ordinary and preferential shares ... represented by American Depository Shares,” the filing said.

U.S. investors sued Eletrobras after the company reported large losses related to a sprawling corruption scandal in Brazil.

The company has said it would look into settlement options, while also maintaining that it was a victim of wrongdoing and that it was collaborating with U.S. prosecutors.

Eletrobras did not admit to any wrongdoing as part of the potential agreement, the filing said.

Reporting by Gram Slattery; Editing by Jeffrey Benkoe

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